A neutral-point-clamped(NPC) three-level inverter normally faces the problems of neutral-point fluctuation and common-mode voltage due to its topological structure and technical characteristics of space vector pulse width modulation. In order to solve these problems, an improved virtual-space-vector pulse-with-modulation(PWM) strategy is proposed, which can balance the suppression of neutral-point potential fluctuation and the reduction of the common-mode voltage. On the basis of traditional virtual-space-vector PWM principle, this strategy achieves the goal of reducing the common-mode voltage by optimizing the basic voltage-vector composition and action order. Meanwhile, closed-loop control strategy is adopted to monitor the neutral-point potential and neutral-point current flow, and dynamically adjust the form of mid-vector to control the neutral-point potential fluctuation within the target range. To verify the practicability and effectiveness of the improved virtual-space-vector PWM strategy, the simulation and experiments were carried out. The results indicate that compared with the traditional virtual space vector PWM, the common-mode voltage can be reduced by 50%, and under the steady state, the neutral-point potential fluctuation can be controlled below 5 V.