Electric Vehicle is the future of sustainable road transport. One of the important issues with electric vehicles is their inverter failure. This paper presents a fault-tolerant technique with phase fault detection and fault removal for a three-phase cascaded H-bridge three-level inverter. The phase fault-detection and fault-removal techniques are based on the switch voltage, switch current and switching signal detection. The cascaded H-bridge three-level inverter is made fault-tolerant by using an additional H-bridge and three bidirectional IGBT switches. The logic of phase fault detection and fault removal is investigated in the MATLAB-Simulink environment and validated in OPAL RT-LAB.