A water jacket is a heat exchanger element enclosed in a boiler. Water is circulated with a pump through the jacket where it picks up heat from the combustion chamber after which the heated water circulates to heat distribution devices.
A water jacket is also an enclosed water-filled chamber in a tankless coiled water heater. When a faucet is turned on, water flows into the water heater heat exchanger. The water in the chamber is heated and transfers heat to the cooler water in the heat exchanger and is sent through the hot water outlet to the appropriate faucet.