A hybrid transformer topology based on Two-Stage Matrix Converter (TSMC) is proposed to solve the problems of compact circuit structure, complex modulation strategy and complicated commutation in current hybrid transformer topology. The topological structure and working principle of TSMC hybrid transformer are analyzed. Considering that the TSMC hybrid transformer needs a faster dynamic response speed, the model predictive control strategy of TSMC hybrid transformer is proposed. A topological discrete state space model is established to compensate the delay effect by two-step prediction of load voltage and input reactive power. According to the two-step predictive value, the objective function is designed to evaluate the control effect of each switch state in advance to control the switch state, so as to improve the dynamic response speed of the control system. Simulation model of the TSMC hybrid transformer system is established by using the Matlab/Simulink tool. Simulation results verify the feasibility of the proposed topology and the good dynamic characteristics of the proposed control strategy. This work is supported by National Natural Science Foundation of China (No. 51277156 and No. 51307148).