This paper presents the usage of the hybrid simulated annealing—evaporation rate water cycle algorithm (SA-ERWCA) for induction machine equivalent circuit parameter estimation. The proposed algorithm is applied to nameplate data, measured data found in the literature, and data measured experimentally on a laboratory three-phase induction machine operating as an induction motor and as an induction generator. Furthermore, the proposed method is applied to both single-cage and double-cage equivalent circuit models. The accuracy and applicability of the proposed SA-ERWCA are intensively investigated, comparing the machine output characteristics determined by using SA-ERWCA parameters with corresponding characteristics obtained by using parameters determined using known methods from the literature. Also, the comparison of the SA-ERWCA with classic ERWCA and other algorithms used in the literature for induction machine parameter estimation is presented. The obtained results show that the proposed algorithm is a very effective and accurate method for induction machine parameter estimation. Furthermore, it is shown that the SA-ERWCA has the best convergence characteristics compared to other algorithms for induction machine parameter estimation in the literature.