This paper presents a nonintrusive method to automatically identify and compensate for current measurement errors in interior permanent magnet synchronous motor (IPMSM) drives. Each IPM motor has a distinct short-circuit current vs. speed characteristic, which is solely defined by its machine design. By controlling the IPM motor to operate at its steady-state short-circuit current during coasting down, all phases of the IPM motor can be safely short circuited using the inverter without introducing any current transients. Then the d-q axis currents measured by the inverter are compared with the known short-circuit characteristic of the IPM motor. The distortion pattern in the d-q axis currents contains all the information needed to correct for current sensor errors in IPMSM drives.