In applications such as ship propulsion and off-shore wind power generation, it is important to minimize the volume of medium voltage power converters. To make this possible, a novel five-level converter topology is proposed in this paper. This converter is realized by connecting two half-bridge (HB) cells with a three-level neutral point clamped (3L-NPC) unit. In each HB cell, the switches are directly clamped to DC side capacitors where the larger volume high-voltage flying capacitors are avoided. By adopting the 3L-NPC unit, the volume of the proposed converter is further reduced. A comprehensive comparison result shows that the volume of the proposed converter is more than 7% less than existing five-level converters. The operation principle and modulation method of this converter are also introduced. Based on the phase-shift pulse width modulation (PS-PWM) method, the capacitor voltages of the proposed converter can be self-balanced. Simulation and experiment results are shown to verify the performance of this converter and the validity of the theoretical analysis.