This paper presents a cascaded robust fault-tolerant predictive control (CRFTPC) strategy with integral terminal sliding mode observer (IT-SMO) to achieve high performance speed loop and current loop for permanent magnet synchronous motor (PMSM) drives. The modeling of PMSM considers the disturbance caused by parameter perturbation and permanent magnet demagnetization. With this model, we can derive the optimal control law of the proposed scheme, which avoids the tuning work of the weight factor effectively. This new CRFTPC strategy has a cascaded structure, external loop and internal loop, both implemented with robust fault-tolerant predictive control. In addition, a new integral terminal sliding mode observer is designed to estimate the disturbances, and thus the robustness of the proposed method can be increased significantly. Comparative simulations and experimentations verify that the proposed CRFTPC provides fast dynamic response, static-errorless speed, and current tracking, even with the system disturbance.