Isolated multilevel inverters are widely used in renewable energy systems and industrial applications. Isolated IGBT topologies exploit the usage of low-frequency transformers that improve robustness and reliability. However, critical failure mechanisms should be considered at the design stage to ensure proper performance. This paper describes these critical failure mechanisms, such as short circuit, cross-conduction, IGBT high inductive load avalanche, IGBT second turn-on, VS-undershoot, transformer inrush current, IGBT thermal runaway, and cable switching interference. Furthermore, this paper comprises design techniques to prevent these failures. The previous failure mechanisms come from the inverter’s power stage, except switching interference from control signal cables and directly affecting the control device functionality. This work also proposes a circuit topology based on FPGA resources to reduce switching interference from control signal cables. It behaves like a fault tolerant digital input that effectively filters bouncing events shorter than 2μs. Measurements report satisfactory experimental results upon constructing a 45kVA ac-side-isolated 13-level inverter.