Monitoring the peak junction hotspot temperature in IGBT modules is critical for ensuring the reliability of high-power industrial multilevel inverters, particularly when operating under extreme thermal conditions, such as in traction applications. This study presents a comprehensive chip-level analytical loss and thermal model for estimation of the peak junction hotspot temperature in a three-level T-type neutral-point-clamped (TNPC) IGBT module. The developed model includes a detailed analytical assessment of conduction and switching losses, along with transient thermal network modeling, based on the actual electrical and thermal characteristics of the IGBT module. Additionally, a hybrid thermal–electrical stress experimental setup, designed to replicate real operating conditions, was implemented for a balanced three-phase inverter circuit utilizing a Semikron three-level IGBT module, with testing currents reaching 100 A and a critical case temperature of 125 °C. The analytically estimated module losses and peak junction hotspot temperatures were validated through direct experimental measurements. Furthermore, thermal simulations were conducted with Semikron’s SemiSel benchmark tool to cross-validate the accuracy of the thermo-electrical model. The outcomes show a relative estimation error of less than 1% when compared to experimental data and approximately 1.15% for the analytical model. These findings confirm the model’s accuracy and enhance the reliability evaluation of TNPC-IGBT modules in extreme thermal environments.