In general, fire retardants reduce the flammability of materials by either blocking the fire physically or by initiating a chemical reaction that stops the fire.

Physical
There are several ways in which the combustion process can be retarded by physical action:

• By cooling: Some chemical reactions actually cool the material down.
• By forming a protective layer that prevents the underlying material from igniting.
• By dilution: Some retardants release water and/or carbon dioxide while burning. This may dilute the radicals in the flame enough for it to go out.

One commonly used fire retardant coating is aluminium hydroxide. When heated, it dehydrates to form aluminum oxide (alumina, Al2O3), releasing water vapor in the process. This reaction absorbs a great deal of heat, cooling the material over which it is coated. Additionally, the residue of alumina forms a protective layer on the material's surface.

Chemical action
Reactions in the gas phase: chemical reactions in the flame (i.e. gas phase) can be interrupted by fire retardants. Generally, these retardants are organic halides (haloalkanes) such as Halon and PhostrEx. However, there are situations where the released gas might be more dangerous when this type of retardant is involved.

• Reaction in the solid phase: some retardants break down polymers so they melt and flow away from the flame. Although this allows some materials to pass certain flammability tests, there is argument over if the fire safety is truly improved by the production of flammable plastic droplets.
• Char Formation: Solid phase flame retardants are those which cause a layer of carbon char to form on the polymer surface. This carbon char layer is much harder to burn and prevents further burning.
• Intumescents: These types of retardant materials add chemicals which cause swelling up behind the protective char layer, providing much better insulation behind the protective barrier. In additions to being added to plastics, these are available as paints for protecting wooden buildings or steel structures.