The degree of integration of power electronic converters in current hybrid electric vehicles can be increased by mitigation of special requirements of these converters, especially those regarding ambient air and cooling fluid temperature levels. Today, converters have their own cooling circuit or are placed far away from hot spots caused by the internal combustion engine and its peripheral components. In this paper, it is shown, how the use of SiC power semiconductors and active control electronics cooling employing a Peltier cooler can help to build an air-cooled inverter system for 120 °C ambient temperature. First, a detailed analysis shows, how the optimum junction of this high-temperature system can be calculated. Then, the operating temperature ranges of power semiconductors, thermal interface materials, capacitors, and control electronics are investigated, leading to a comprehensive analysis of mechanical concepts for the inverter system in order to show new ways to solve electrical and thermal tradeoffs. In particular, the operation of the signal electronics and the gate driver for power semiconductors with a junction temperature of 250 °C within the specified operating temperature range is ensured by appropriate placement and cooling methods, while taking the electrical requirements for limits on the wiring inductances and symmetry requirements into account. The analysis includes an accurate thermal model of the converter and an optimized active cooling of the signal electronics using a Peltier cooler. Finally, a hardware prototype with discrete power semiconductor devices and thus with a junction temperature limit of 175 °C driving high-speed electrical machines is shown to validate the theoretical considerations in a custom-designed high-temperature test environment.