This paper proposes a three-level diode clamped active impedance source (AIS-TLI) inverter based on the quasi Z-source inverter (qZSI). Apart from having minimal components and the inherent benefits of three-level qZSIs, such as single-stage buck-boost capability, shoot-through (ST) immunity, and continuity of input current, the proposed topology has a higher boost capability and excellent efficiency. In addition, the inverter bridge has a higher modulation index, which improves the quality of the output waveform and necessitates less inductance. The proposed topology provides common ground between input and output terminals, which effectively eliminates leakage current in PV-powered single-phase systems. This paper describes the different operating modes principle, dynamic analysis, steady-state analysis, and parameter selection instructions for the proposed in-depth. Furthermore, the suggested inverter's benefits and limitations are compared to the traditional (q)ZSIs and some other AIS-TLIs. Finally, modeling and experimental results are used to confirm the effectiveness of the suggested topology.