A power electronic transformer converter made of cascaded multiple cells with a medium frequency link can replace the bulky traditional transformer in various applications with several advantages, including reduced size and weight, and energy savings. This paper describes the design of a 1.2MW power electronic transformer (PET) demonstrator for traction applications. Several design challenges, i.e. the selection of the IGBT modules, the design of the multiple-functional medium frequency transformer, and the mechanical arrangement to achieve the high voltage insulation between the grid voltage and ground potential, have been discussed. The experimental results, obtained from the developed PET demonstrator, are presented.