The organic materials used for stator winding insulation are subject to deterioration from thermal, electrical, and mechanical stresses. Stator winding insulation breakdown due to excessive thermal stress is one of the major causes of electric machine failures; therefore, prevention of such a failure is crucial for increasing machine reliability and minimizing financial loss due to motor failure. This work focuses on the development of an efficient and reliable stator winding temperature estimation scheme for small to medium size mains-fed induction machines. The motivation for the stator winding temperature estimation is to develop a sensorless temperature monitoring scheme and provide an accurate temperature estimate that is capable of responding to the changes in the motors cooling capability. A discussion on the two major types of temperature estimation techniques, thermal model-based and parameter-based temperature techniques, reveals that neither method can protect motors without sacrificing the estimation accuracy or motor performance. Based on the evaluation of the advantages and disadvantages of these two types of temperature estimation techniques, a new online stator winding temperature estimation scheme for small to medium size mains-fed induction machines is proposed in this work. The new stator winding temperature estimation scheme is based on a hybrid thermal model. By correlating the rotor temperature with the stator temperature, the hybrid thermal model unifies the thermal model-based and the parameter-based temperature estimation techniques. Experimental results validate the proposed scheme for stator winding temperature monitoring. The entire algorithm is fast, efficient and reliable, making it suitable for implementation in real time stator winding temperature monitoring.