For relatively low voltage dc sources such as photovoltaic arrays and fuel cell stacks to supply power to typical AC systems, using multilevel inverters is an approach with several advantages. In doing so, while it is possible to achieve optimal THD below 5% by staircase/block modulation of cascaded H-bridge multilevel inverters, this requires the use of several separate dc sources with different non-integer ratio values. This paper proposes having some of these source values be equal to each other to increase sub-system modularity, and replacing some H-bridge cells by a diode-clamped inverter to reduce the required number of separate dc sources, while still achieving near-optimal THD below 5%. In addition, a means of re-charging the diode-clamped inverter's inner capacitors is proposed Analytical, simulation and experimental results are presented for an example hybrid converter with four H-bridge cells in series with a 5-level diode-clamped inverter.