Hybrid railway power conditioner (HRPC) has been applied to compensating negative-sequence current, reactive power and harmonics in a traction power supply system. Single-phase back-to-back converter is used to implement power conditioning in a HRPC. Its operational voltage is lower than a conventional RPC since it is coupled to 25 kV feeder via a LC branch. However, multilevel converter was not used which is necessary if the HRPC is coupled to the feeder without transformer. A HRPC based on single-phase half-bridge back-to-back modular multilevel converter (MMC) is proposed in this paper. The center-split point of the DC bus is connected to one phase and provides compensating current. Since direct current tracking with hysteresis PWM is not applicable to MMC, proportional-integral (PI) current controller is selected to generate voltage reference. The circulating current is analyzed in detail and parameter design of the MMC is presented. The cell voltage balancing and dc bus voltage balancing of the MMC are studied. Simulation results are provided to verify the effectiveness of the proposed HRPC with its control method.