A thermodynamic system is a set of objects whose thermodynamic properties are of interest. The system is considered to be embedded in its surroundings or the environment. The system and its environment can exchange heat and do work on each other through a boundary that separates them. However, the immediate surroundings of the system interact with it directly and therefore have a much stronger influence on its behavior and properties.

Consider an example of tea boiling in a kettle. The tea and the kettle together are a system. If the kettle lid is kept open, steam from the boiling tea escapes to the surroundings, which is an example of an open system. Now, if the kettle lid is closed, the steam cannot escape, i.e., matter cannot escape, but the energy in the form of heat is exchanged with the surroundings. Hence it becomes a closed system.

However, if the hot tea is poured into a thermos, neither matter nor energy can be exchanged with the surroundings for a specific time. This type of system becomes an isolated system.

In reality, any system cannot be isolated infinitely. In the case of a thermos, the tea will eventually cool down, indicating that energy exchange took place between the system and the surroundings.

When the tea inside the thermos attains the same temperature as the surroundings, the system and the surroundings are in thermal equilibrium.

In mechanics, equilibrium is defined by the balance between the forces and the torques in the system. However, in thermodynamics, it is essential to study the heat transfer processes between the system and the surroundings, leading to the system's thermal equilibrium. The concept of thermal equilibrium eventually leads to the Zeroth Law of Thermodynamics. This law is equally applicable to the different parts of a closed system and requires that the temperature everywhere inside the system be the same if the system has reached thermal equilibrium.