This paper proposes a method of estimating motor parameters in permanent magnet synchronous motor and estimating the magnet operating point using magnetic equivalent circuit. The first step of the proposed method is that the electrical parameters of the motor can be estimated independently using the modified model reference adaptive system with additional current sampling points. The second is to estimate the flux leakage of stator and the residual magnetic flux density of the magnet corresponding to the components of the magnetic equivalent circuit, using estimated inductances and flux linkage. This results in the compensated magnetic permeance and magnetomotive force being reflected in the magnetic equivalent circuit, and the magnetic flux density of magnet can be estimated more accurately. Finally, using the estimated residual magnetic flux density, the magnet temperature can be estimated by the temperature coefficient equation. The simulation and experimental verification have been provided to demonstrate the effectiveness of the proposed method. The proposed method is relatively simple and can identify the operating point of the permanent magnet in real time. Therefore, it is expected that this study will help in terms of the protective logic design for permanent magnet and an improvement of efficiency in PMSM.