In drilling operation, drilling NPT caused by top drive mechanical failure and high noisy and energy suffered a lot onsite. This paper introduces a top drive which utilizes a permanent magnet synchronous AC motor to drive the quill directly without a gearbox which can shorten drive chain. Meanwhile, its symmetrical and compact mechanical construction and shorter main and control cables obviously improve installation efficiency and effectively reduce the failure rate. We conducted research through structural design, motor efficiency and heat dissipation, and automation system upgrades to form a set of high-efficiency, high-performance direct drive top drive. Transmission structure aspect: design of direct-drive top drive structure, calculation and verification of main load bearing parts, analysis of top drive failure types and effects. Motor energy efficiency aspect: research on speed measurement method of permanent magnet direct drive motor, precise control method of permanent magnet direct drive motor, and closed phase change heat dissipation technology. Automation enhancement aspect: research on control system architecture, self-diagnosis system, One-click operating system. This study resulted in three research findings including synchronous permanent magnet motor design, One-Click operating system with self-diagnosis and efficient self-circulation heat dissipation technology. The new generation of direct-drive top drive can reduce current required by 100-200A and increase efficiency by 20-30% compared with asynchronous motor, while meeting the requirements of corresponding rated load, rated power, speed and continuous torque. It can realize quill rotation precision less than 1° under load and keep the speed fluctuation reduced from 10.6% to 1.1% by improving the motor dynamic response performance. The One-click control method realized by preset parameters can reduce the driller's repeated operation and visual judgment. The tripping efficiency can be increased by 11.9%, reducing the driller's operation complexity and improving drilling safety. The application of phase-change heat dissipation system can reduce ambient noise to 72dB without external circulating pump. At present, over 10 sets of this new equipment have been delivered and industrial applications have been launched in CNPC Dagang Oilfield, CNPC Weiyuan National Shale-Gas Demonstration Zone and Sinopec NiuYe Shale-Gas Demonstration Zone. Till now nearly 20 wells have been conduct with running trouble-free throughout. Intelligent direct drive top drive of synchronous permanent magnet motor with phase change heat dissipation can not only improve the top drive mechanical transmission efficiency and extend the service life of main components, but also can reduce energy consumption and improve the automation level of top drive, making the top drive further satisfy the high-demanded requirements in drilling operation. We believe that there will be a great demand in deep wells, ultra-deep wells and unconventional oil and gas resources exploitation, which has a broad application prospect and good economic and social benefits.