Heat insulation applications carried out on external walls of building provides energy saving by decreasing fuel consumption and also quite important in decreasing emission which results from fossil-based fuel usage and causes air pollution. In this study, economic and environmental analyses were done for determination of external wall optimum thickness in using coal and natural gas usage in Karabuk. Economic extent of the study was done with P-1-P-2 method which is based on life cycle cost analysis (LCCA). The results show that optimum insulation thickness and energy saving are 0.134 m and 117.14 TL/m(2) respectively when coal is used as a fuel. These values are 0.116 m and 88.39 TL/m(2) when natural gas is used as fuel. When the effects of optimum insulation thickness on air pollution are observed, CO2 and SO2 emissions calculated on external wall of uninsulated building decreased up to 85.4% at the point of optimum insulation thickness according to fuel type.