Most gas turbines are internal combustion engines but it is also possible to build an external combustion gas turbine which is, effectively, a turbine version of a hot air engine.

External combustion has been used for the purpose of using pulverized coal as a fuel. If this fuel were used in a conventional gas turbine there would be rapid erosion of the turbine blades by particles of ash. The solution is to have two separate circuits:

1. a combustion circuit in which the fuel is burned
2. a turbine circuit which contains pure air

Heat is transferred from circuit (1) to circuit (2) by a heat exchanger. The thermal efficiency will be lower than with internal combustion but this may be acceptable if it permits the use of cheap fuel.