Isolation transformers are used to transfer electrical power from a source of alternating current power to a device, where the powered device is isolated from the power source for safety measures. They provide galvanic isolation, which is the principle of isolating different sections of electrical systems to prevent current flow. Here, there is no direct conduction path but, the energy is still exchanged between sections by capacitance, induction, or electromagnetic waves. However, these transformers block the transmission of the DC component in signals from one circuit to another, while letting the AC components to pass.

Isolation transformers that have a ratio of 1:1 between the primary and secondary windings are used to protect against electric shock between the ground and energized conductors. They are also used to suppress electrical noise and are used for supplying power in sensitive devices like computers, medical devices, and laboratory instruments. There is special insulation between the primary and secondary in such transformers, and high voltage ranging from 1000 to 4000 volts can be borne between the windings.