An external combustion engine is an engine which burns its fuel to heat a separate working fluid which then in turn performs work. Examples include steam engines and Stirling engines. External combustion engines are often less compact and less powerful than internal combustion engines, but are sometimes more efficient, and are much less particular about the type of fuel they burn.

Mechanical energy and heat energy are related. For example, mechanical energy is changed into heat by friction between the moving parts of a machine. Heat energy, in turn, can be changed into mechanical energy by heat engines.

Heat engines can be divided into two groups: (1) external-combustion engines and (2) internal-combustion engines. External combustion engines produce hot gases that transfer heat energy to another fluid. The heat energy in this fluid, in turn, is changed into mechanical energy. Such engines include gas and steam turbines and reciprocating steam engines. Internal-combustion engines produce hot gases whose heat energy is changed directly into mechanical energy.

A steam turbine is a good example of an external-combustion engine. Heat from burning fuel or from a nuclear reactor changes water in a boiler to steam. Pipes carry the steam into the turbine, which has a series of bladed wheels attached to a shaft. The high-temperature steam expands as it rushes through the turbine and so pushes on the blades and causes them to turn the shaft. Steam leaving the turbine has a much lower temperature. The spinning shaft can drive an electric generator, move a ship's propeller, or do other useful work.