We have revealed that a new type of solar cells, intermediate-band-assisted hot-carrier solar cells using indirect-bandgap absorbers, can solve serious issues involved in intermediate-band solar cells (IB-SCs) and hot-carrier solar cells (HC-SCs). We have analyzed energy dissipation processes in these cells using the detailed balance models. In an HC-SC, energy dissipation related to entropy generation associated with hot-carrier extraction is a major issue when the thermalization rate of hot carriers is too rapid, although energy dissipation caused by the thermalization is sufficiently reduced. An IB-SC requires “photon selectivity,” where the spectral absorption ranges for the different interband transitions have no overlap with each other; otherwise, additional energy dissipation due to thermalization occurs. When hot carriers are extracted from an IB absorber, the feature that the current density is decreased because of the two-step excitation via the IB significantly reduces the entropy generation and consequently relaxes the requisite for the thermalization time. Even though the photon selectivity is broken, the increasing carrier energy in excess of each bandgap is efficiently converted to electricity by extracting hot carriers. The current density is further decreased using an indirect-bandgap absorber, leading to even higher efficiency. The limiting conversion efficiency of this new type with no photon selectivity has been calculated to be higher than those of IB-SCs with perfect selectivity by around 10%, assuming the thermalization time being 1 ns. This improvement is contrasting to the fact that the efficiency of HC-SCs is only slightly higher than the Shockley–Quisser limit at 1 sun. Copyright © 2012 John Wiley & Sons, Ltd.