There are two main types of modular construction, also known as prefabricated construction, available: mobile offices and modular buildings. Mobile offices consist primarily of pre-made stock buildings that are typically used by construction companies for temporary office space. Modular buildings, in contrast, are custom-built to a user's specifications.

With both types of buildings, construction of the building takes place in a factory-controlled environment using the same materials utilized for traditional construction. The entire building is not built in one piece; instead, the floor plan is broken up into individual modules that can be shipped on the road. Each module ranges in size from 10 to 18 feet wide to 36 to 76 feet long, with the module width depending on state shipping regulations.

Up to ninety percent of a building is normally constructed at the factory. Each module is built out with walls, ceilings, carpeting, and wiring. Building modules are then assembled to form a seamless building when they reach the destination site.

Most modular buildings consist of one to two modules and occupy one floor, for a total of one to two thousand square feet. Modular buildings can also be used for much larger spaces ranging in the tens and even hundreds of thousands of square feet and can be three or four stories tall.