The inverter converts 12 volts DC into 120 volts AC by chopping up the DC wave, then shaping and filtering the resultant pulses to generate AC. Most inexpensive consumer grade models use what is known as a "modified sine wave" output in that the pure sine wave is approximated by a series of voltage steps. There are pure sine wave models available from a few manufacturers, but they are expensive and primarily intended for home power applications.

Choosing an inverter can be a tedious process, as the number of manufacturers and capacity ranges are truly staggering. For the general consumer, there are three primary categories: cigarette lighter models, dual models, and direct connect models.

Cigarette lighter models usually come with a cigarette lighter plug and are capable of running one or two household outlets. These models are usually rated below 200 watts total output and are intended for light intermittent use. Dual models have both cigarette lighter plugs as well as direct connections, and usually have 2 or possibly 3 outlets with outputs ranging from 200 to 800 watts total output. Direct connect models range from 800 watts on up, might supply up to 4 regular outlets, and are intended for those applications beyond what the average consumer would need.

The real challenge in the installation and use of inverters is in the connection from the automobile battery to the inverter. Most people think that any old wire will do, but surprisingly wire used at 12V must actually be larger than that used at 120V just because currents are so high and voltage drop becomes a factor. For example, a 100 watt light at 120VAC uses about one amp. At 12V, the same 100 watt light will need 8.3 amps, necessitating a larger wire. In fact, most manufactures recommend #4 AWG wire for an 800 watt inverter installation. In comparison, most household wiring is #12 AWG and much smaller.