Central heating differs from space heating in that the heat generation occurs in one place, such as a furnace room in a house or a mechanical room in a large building (though not necessarily at the "central" geometric point). The heat is distributed throughout the building, typically by forced-air through ductwork, by water circulating through pipes, or by steam fed through pipes.

The most common method of heat generation involves the combustion of fossil fuel in a furnace or boiler. Increasingly, buildings utilize solar-powered heat sources, in which case the distribution system normally uses water circulation.

In much of the temperate climate zone, most new housing has come with central heating installed since the Second World War, at least. Such areas normally use gas heaters, district heating, or oil-fired system, often using forced-air systems. Steam-heating systems, fired by coal, oil or gas, are also used, primarily for larger buildings. Electrical heating systems occur less commonly and are practical only with low-cost electricity or when ground source heat pumps are used. Considering the combined system of central generating plant and electric resistance heating, the overall efficiency will be less than for direct use of fossil fuel for space heating.