The diagram shows a Hohmann transfer orbit to bring a spacecraft from a lower circular orbit into a higher one. It is one half of an elliptic orbit that touches both the lower circular orbit the spacecraft wishes to leave (green and labeled 1 on diagram) and the higher circular orbit that it wishes to reach (red and labeled 3 on diagram). The transfer (yellow and labeled 2 on diagram) is initiated by firing the spacecraft's engine in order to accelerate it so that it will follow the elliptical orbit; this adds energy to the spacecraft's orbit. When the spacecraft has reached its destination orbit, its orbital speed (and hence its orbital energy) must be increased again in order to change the elliptic orbit to the larger circular one.
Due to the reversibility of orbits, Hohmann transfer orbits also work to bring a spacecraft from a higher orbit into a lower one; in this case, the spacecraft's engine is fired in the opposite direction to its current path, slowing the spacecraft and causing it to drop into the lower-energy elliptical transfer orbit. The engine is then fired again at the lower distance to slow the spacecraft into the lower circular orbit.
The Hohmann transfer orbit is based on two instantaneous velocity changes. Extra fuel is required to compensate for the fact that the bursts take time; this is minimized by using high-thrust engines to minimize the duration of the bursts. For transfers in Earth orbit, the two burns are labelled the perigee burn and the apogee burn (or ''apogee kick); more generally, they are labelled periapsis and apoapsis burns. Alternately, the second burn to circularize the orbit may be referred to as a circularization burn.
Type I and Type II
An ideal Hohmann transfer orbit transfers between two circular orbits in the same plane and traverses exactly 180° around the primary. In the real world, the destination orbit may not be circular, and may not be coplanar with the initial orbit. Real world transfer orbits may traverse slightly more, or slightly less, than 180° around the primary. An orbit which traverses less than 180° around the primary is called a "Type I" Hohmann transfer, while an orbit which traverses more than 180° is called a "Type II" Hohmann transfer.