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Lithium battery is a complex nonlinear time-varying system with several inconsistencies. The fault diagnosis method has difficulty making an early diagnosis of battery faults without obvious abnormalities. In fact, voltage inconsistency is a representative fault response. Therefore, the monitoring of voltage inconsistency is highly important for the safe and reliable operation of lithium batteries in E-vehicles. The entropy method does not rely on an accurate analysis model and expert experience. Moreover, it does not consider the complex fault mechanism and system structure. Hence, it has gradually attracted widespread attention. Given such attention, a hybrid fault diagnosis method combining multiscale permutation entropy (MPE) and coefficient of variation (CV) is presented in this paper, and the improved MPE fault diagnosis model based on 3-sigma is emphasized. First, MPE and the 3-sigma rule are used to calculate the threshold, and the voltage inconsistency of the battery is judged by the threshold. Then, the location of the faulty cells is located by the CV. The superiority of the proposed method is proven by experimental data from the Yunzhitong platform of CRRC Electric Vehicle Co., Ltd. and a comparison of frontier methods. The proposed approach is feasible and promising in real E-vehicle applications.