Reliability of the multilevel inverters (MLIs) is one of the most important concerns in industrial applications, mainly due to the semiconductor devices. Whenever a fault occurs in one of the switches of the inverter, it leads to abnormal conditions and can also cause serious damage to the equipment connected to the multilevel inverter. In this paper, a recently proposed nine-level Packed-E-Cell (PEC) multilevel inverter topology is investigated for its fault-tolerant capability and improved reliability. The analysis is carried out for a reduced device multilevel inverter topology that, due to a lack of redundant states, cannot tolerate switch failures. The fault-tolerant (FT) topology provides additional redundant states in the switching sequence of the existing topology. The work in this paper presents Packed-E-Cell MLI modified for fault tolerance against single-switch open-circuit faults. The modified FT topology inherently achieves self-voltage balance in the DC-link capacitors. Nearest Level Control(NLC) is used as the modulation strategy for generating the desired switching pulses. Simulation results are obtained in MATLAB/Simulink for the conditions prior to the fault, during the fault and post fault, and results are discussed. Experimental verification of the modified FT topology is also performed, in order to validate its effectiveness.