Rheem Manufacturing Company was established in the mid-1920s when brothers Richard and Donald Rheem acquired a galvanizing plant in San Francisco, California. In the 1930's, Rheem began manufacturing water heaters, and by 1936 had coast to coast distribution. During the 1940s and 1950s, the company increased its product line to include space heating units for homes, oil furnaces and air conditioners.
In 1959, Rheem acquired Ruud Manufacturing Company, a pioneer in the water heating industry with a well-regarded product line and a distribution network throughout North America. In subsequent years, Rheem entered the heating and air conditioning market and expanded in the late 1960's and 1970's with the rapid growth of the central air conditioning industry. In 1985, the company acquired Raypak, a leading producer of copper tube boilers used for swimming pool heating and commercial hot water supply and hydronic heating.