Recently, a single-phase five-level packed U-cell(PUC5) inverter with capacitor voltage self-balancing has attracted much attention, but the self-balancing mechanism remains unknown. In this paper, the self-balancing mechanism in the sense of the small-signal model is revealed. It is found that the conventional averaged switch model can not explain the self-balancing phenomenon. Thus, an extended frequency small-signal model of the PUC5 inverter is derived, and the accuracy of this model is verified. Furthermore, the stability analysis of the capacitor voltage is conducted to prove the capacitor voltage self-balancing capability of the PUC5 inverter. Experimental results validate the correctness of the analysis.