An innovative low temperature differential variable air volume fan-coil unit (LTD-VAV FCU) was developed to improve the defects of variable air volume (VAV) and cold air distribution energy-saving technologies. A test bench and procedures according to its unique air supply features were established to investigate the energy-saving and IAQ improving potential experimentally. The experimental results of the prototype indicated the supply air volume can be continuously varied between 0.09 m(3)/S (200 CFM) and 0.38 m(3)/s (813 CFM), controlled by the bypass damper giving an air supply/air return temperature difference from only 2.30 to 8.09 degrees C. The effect of reducing the supply/return air temperature differential not only makes people feel comfortable, but also improves the cold draft and condensing at the outlet generated by ordinary air supply method. In addition, continuous capacity variations range from 0.45 kW (383 kcal/h) to 5.29 kW (4550 kcal/h) rendering to achieve the effect of comfort at a stable indoor thermal condition. Moreover, the temperature difference of chilled water ranges from 0.42 to 5.05 degrees C, the chiller plant not only can be unloaded at a low temperature difference to enhance energy-saving, but also complement other areas for multi-area application. (C) 2006 Elsevier B.V. All rights reserved.