This paper involves the selection and sizing of the appropriate type of dc bus capacitor for various applications utilizing PWM operated three-phase voltage source inverters, such as battery operated systems, PV (photovoltaic) systems, UPSs, and motor drives. It classifies the power converter topologies based on dc bus ripple current frequency characteristics. A general approach for ripple current characterization is provided. Based on these characteristics, the two capacitor types suitable for this purpose, the electrolytic and film capacitors, used in inverter applications are reviewed. Capacitor power loss and voltage ripple calculation are provided for both types. Then, a thorough algorithm for dc bus capacitor design is provided. The application of the proposed design method is demonstrated through several design examples. Overall, the paper helps the power electronics development and design engineer in the design and performance evaluation procedure of dc bus capacitors for three-phase inverters. The method is simple but rigorous and accurate.