Two cascaded two-level inverters can synthesise three-level voltage space vector. For the cascaded three-level inverter controlled induction motor, this study proposes a five-level torque controller (FLTC)-based direct torque control (DTC) method especially for improving steady-state motor torque performance and retaining the high dynamic performance. The proposed FLTC method employs hysteresis controllers, uses look-up tables and ends up with variable switching frequency of the cascaded three-level inverter. Computationally, the envisaged FLTC method is quite comparable to that of the basic DTC method. The FLTC method ensures reduced switching commutations in the inverter switching devices during low speeds of operation and simultaneously achieves reduced dv/dt switching stresses. An inherent drawback of FLTC method at higher speeds of operation is identified, theoretically analysed and a pseudo error-based correction is also suggested in this study to overcome the drawback. The steady-state and transient motor torque performance of the induction motor with the use of the envisaged FLTC-based DTC method is thoroughly analysed, simulated using Matlab/Simulink and then experimentally validated on a laboratory prototype for starting, speed reversal and load change conditions with the use of the cascaded three-level inverter. © The Institution of Engineering and Technology 2017.