Air handlers are typically located in the garage, attic, or in a closet, unless it is part of a packaged unit, in which case it is incorporated into the rest of the HVAC system.
Usually, it connects to the ductwork that acts as distribution for conditioned air throughout the home, as well as a return system to the air handler. In other cases, the air handler exchanges air directly with the space without any ductwork necessary.
Types of air handlers include up flow, down flow, and horizontal flow.