This thesis focuses on the need for building an effective analytical model of interior type permanent magnet (interior-PM) motor to precisely predict the air gap field and machine parameters. Further, the analytical model is developed to be a practical “tool” using for the shape optimum design. Therefore, by properly utilizing the proposed analytical method, the computation time of by commonly employing the finite element analysis (FEA) can be largely saved and the exhausting process of optimum shape design with multiple design parameters varied in wide ranges can be effectively simplified. Firstly, for enhancing the precision of analytical prediction, a basic analytical model of interior-PM motor is improved by introducing two assistant models, by which the inherent difficulties of magnetic flux distortion phenomenon and magnetic saturation effect due to the unique interior-PM design are well overcame respectively. The effectiveness of the analytical model is well confirmed by FEA solution of the air gap field distribution and machine parameters, such as back electromotive force, cogging torque, and so on. Then, as an important contribution, a series of relative permeance method are formulated according to the shape designs of rotor and stator faced surfaces, including slot-opening, bifurcated tooth and rotor surface eccentricity, and then the refined expressions are obtained based on the space field characteristics in interior-PM motor. The space field-based relative permeance method is effective for considering the effect of non-uniform air gap regions on flux density distribution. Finally, an experiment study on current vector control is presented for investigating the relationships between machine parameters, vector control strategies and machine performances. In addition, with an existing interior-PM motor for neighborhood electric vehicle (NEV) drive, the validity of presented analytical design method is confirmed in practice with the errors discussion between analytical results and measurement.