Applications of motor drives, ranging from automotive traction to more-electric aircraft, have widely varying speed and torque demands. With extensive use of inverter-fed drives, loss minimization techniques for such applications have evolved over the past few decades. Previous work on loss minimization has mainly focused on specific drive components. Component-level loss minimization, however, will not guarantee minimum total loss in the drive system. In this paper, a system-level loss minimization method is developed using a comprehensive loss model, to achieve true minimum total loss in the system. The total loss obtained is lower for the proposed system-based minimization than the component-based methods such as machine loss minimization, torque maximization per stator ampere and dc-link loss minimization. Simulation and experimental results for a sample drive cycle are presented to verify the benefits of the proposed scheme for an induction motor drive. Results suggest system loss reduction of about 7%, when compared to machine-based optimization, in high-variability applications.