Different package technologies have different impacts on the electrical characteristics, heat dissipation and reliability of power semiconductor modules. In this paper, the influence of module stray inductance on the switching behaviors and switching losses was analyzed. By using the optimized turn-on and turn-off gate resistors, 20%~30% of the switching losses can be reduced if the module stray inductance is improved from 20 nH to 10 nH. Then the thermal resistance of different materials was analyzed to demonstrate their influences on the heat dissipation of power modules. Among which, thermal interface material (TIM) and direct bonding copper (DBC) are found to be the most critical factors for the heat dissipation. The methods as how to improve the heat dissipation capability were illuminated in this paper, such as using high-performance thermal interface material and optimization of its application process, using high-thermal-conductivity DBC, optimization of chip size and distance, as well as the baseplate structures. Coefficient of thermal expansion (CTE) mismatch between adjacent materials is considered to be the main reason of module aging and consequently reliability issue. The failure mechanisms and phenomena of bond wires and solder layers were explained. To improve the reliability and lifetime of power modules, some promising materials and processes were introduced.