A system for thermal management of an electric motor, uses an augmented thermal circuit model of the electric motor, which relates temperatures of a set of nodes of the thermal circuit model with the temperature measurements at a first subset of nodes and heat losses of heat sources at a second subset of nodes, for joint estimation of the temperatures at the entire set of nodes and values of the heat losses in the second subset of nodes. The system solves the joint estimation using an estimator/observer. The system outputs one or combination of the values of the temperatures of the set of nodes and the values of the heat losses.