This article presents a method to include fault currents in the reliability analysis of motor drives. The presented method is based on formulating a fault current matrix (FCM), the elements of which are values of the currents flowing in all parts of a motor drive. The FCM is processed using the principal component analysis (PCA) to determine the pattern of variations in all currents due to any failure event. The output of the PCA is used to determine the failure rates for all parts of a motor drive. Determined failure rates can provide a tool to set an adequate action (mitigation, maintenance, or shutdown) to ensure a reliable and safe operation during and post any failure events experienced by the motor drive. The validity and accuracy of the PCA-FCM method are verified by employing it in the reliability analysis of different motor drives with different ratings. Results demonstrate the advantages of including fault currents in setting adequate actions in response to possible failure events.