I think that everyone knows how a hot air balloon works in theory but what are the basic physics behind it? The basic concept of it is that it blows hot air into the large balloon at the top to create buoyancy which eventually causes the balloon to lift. The air inside of the balloon is ultimately less dense than the air outside and this difference in density is also what causes the balloon to lift. The principle behind this lift is called Archimedes principle. This states that the upward buoyant force exerted on a body is equal to the weight of the fluid that the body displaces and acts in the upward direction. This is the same principle that describes how boats stay afloat in the water.