This paper presents a single-phase cascaded H-bridge multilevel photovoltaic inverter containing a special supercapacitor cell. The cascaded H-bridge multilevel topology enables independent DC voltage control for each PV panel or string to meet the requirements of distributed maximum power point tracking, which reduces the efficiency loss caused by panel mismatch and unequal sheltering. But as the total power of distributed grid-connected photovoltaic inverter increases, the power fluctuation brought by those photovoltaic systems will become serious and even affect the stability of the grid. To alleviate this problem, a supercapacitor cell is added to the inverter. It not only smooths the PV inverter's output power fluctuation, but also increases the inverter's output level. For the coordination of these two kinds of cells, a control strategy is proposed, in which all cascaded PV cells only output active power, and the supercapacitor cell undertakes the reactive active power and compensates the active power fluctuations. Experimental results are presented to verify the feasibility of the proposed approach. The fluctuations in the output power are effectively smoothed, and the inverter gets unity power factor.