Large and small single-phase and three-phase induction motors are commonly used in industrial applications. The present work represents an attempt towards the design of a high accuracy system for the measurement of fractional horsepower (FHP) induction motor losses and efficiency. The calorimeter designed and built is capable of measuring heat losses of up to 1 kW with an overall accuracy better than 3%. During all tests, ambient temperature, humidity, motor speed and motor frame temperature were recorded using precise digital instruments. The inlet, outlet temperatures and resulting losses were recorded automatically using a high accuracy 12-bit data acquisition system. The preliminary results obtained demonstrate the suitability of the designed calorimeter for the accurate measurement of losses in FHP induction motors.