Cognac is a type of brandy and, after the distillation and during the ageing process, is also called eau de vie. It is produced by double distilling white wines produced in any of the designated growing regions. The white wine used in making cognac is very dry, acidic and thin. Though it has been characterised as "virtually undrinkable", it is excellent for distillation and ageing. It may be made only from a strict list of grape varieties. In order for it to be considered a true cru, the wine must be at least 90% Ugni blanc, Folle blanche and Colombard.

After the grapes are pressed, the juice is left to ferment for two or three weeks, with the region's native, wild yeasts converting the sugar into alcohol. Distillation takes place in traditionally shaped Charentais copper alembic stills, the design and dimensions of which are also legally controlled. Two distillations must be carried out; the resulting eau-de-vie (like moonshine or white dog) is a colourless spirit of about 70% alcohol.

Once distillation is complete, it must be aged in Limousin oak casks for at least two years before it can be sold to the public. The cognac is then transferred to large glass carboys called bonbonnes, then stored for future blending. Since oak barrels stop contributing to flavour after four or five decades, longer ageing periods may not be beneficial.

The age of the cognac is calculated as that of the youngest component used in the blend. The blend is usually of different ages and (in the case of the larger and more commercial producers) from different local areas. This blending, or marriage, of different eaux-de-vie is important to obtain a complexity of flavours absent from an eau-de-vie from a single distillery or vineyard. Each cognac house has a master taster (maître de chai), who is responsible for blending the spirits, so that cognac produced by a company will have a consistent house style and quality.