This study presents a novel circuit topology for a single-phase inverter using an active power decoupling circuit operated in discontinuous current mode (DCM). In a conventional single-phase grid-tied inverter, bulky capacitors are used in a DC-link to absorb a power ripple with twice the grid frequency. However, electrolytic capacitors limit a converter's lifetime. In contrast, ceramic capacitors are used in the proposed circuit since the required capacitance is reduced. Furthermore, the active power decoupling circuit in DCM has no inductor inside by utilizing the current zero cross featured in DCM for power ripple compensation modes. An experimental verification using a 1-kW prototype shows a 90.2% current ripple reduction caused by the power ripple with twice the grid frequency. The efficiency exceeds 94% in the 20% region of the rated power to 1-kW through 96.0% of the 650 W maximum. According to a theoretical evaluation using a Pareto-front optimization assumed as a 3-kW system, the proposed circuit reaches the maximum power density at 20 kHz which is 115 % higher than that of the passive power decoupling method. The inductor volume in the proposed circuit is reduced by 30.4% compared to a conventional buck-type active power decoupling circuit.