Motors are required to be tested for different requirements such as after manufacturing, rewinding, new environmental conditions etc. by using type tests. Motor should have the ability to run for a long time under full load without exceeding its thermal and mechanical limits. The loading unit should have the same capacity as the motor. Currently, DC generator with lamp load and eddy current brake are used but these loading units are less controllable and inefficient. This paper discusses about a suitable and efficient loading unit which can be used to test motors. This unit consists of a DC motor load coupled with the test motor in which the DC motor is driven by a power electronic controller. The significance of this particular scheme for loading is that it can serve most of the requirements that arise in practice that other loading types cannot do. The power electronic controller consists of an AC to DC bidirectional converter to provide power back and forth between the DC motor and the utility grid. Also, there is a bidirectional DC to DC converter to maintain the required voltage levels. The DC Motor has the ability to imitate different loads and to act in both generating mode as well as motoring mode.