Abstract: A high efficiency gas hot water heater has a vertical cylindrical water tower and a cylindrical combustion chamber secured to the wall of the vertical water tower and extending horizontally therefrom. The combustion chamber has means at the outer end for the injection of gas and air therein, the products of combustion of gas and air produced in the combustion chamber flowing into the vertical water tower which has, at its upper end, a flue. A generally horizontal water distributor is positioned within the water tower adjacent to the top. A water jacket surrounds the combustion chamber with piping providing a water inlet into the water jacket and from the water jacket into the water distributor so that the products of combustion of the gas and air in the combustion chamber flow into the vertical water tower and upwardly therethrough as water flows downwardly therethrough.