A closed-form solution is presented for the steady-state response of interior permanent magnet (IPM) synchronous machines to symmetrical short circuits including the effects of q-axis magnetic saturation. Machine response to single-phase asymmetrical short circuits is also investigated. Experimental data are presented to verify predicted behavior for both types of short circuits. It is shown that single-phase asymmetrical short circuit faults produce more severe fault responses with high pulsating torque and a significant threat of rotor demagnetization. A control strategy that purposely transitions such faults into symmetrical three-phase short circuits can minimize the fault severity and associated demagnetization risks. Implications for the design of IPM machines with improved fault tolerance are discussed.