Emissions of air pollutants from household solid fuel combustion in low-efficiency stoves have serious negative impacts on human health and air quality in China. This study compares the thermal efficiency (TE) and emissions from solid fuel combustion in a newly developed under-fire heating stove and a typical traditional over-fire heating stove. The average TEs for burning all tested fuel types (semi-coke, anthracite, briquette, bituminous, lignite, and biomass) were 83 and 42% for the new stove and the traditional stove, respectively. The new stove was effective in reducing CO2 and pollutant emissions per unit energy delivered to a radiator. The average reductions were ∼50% for CO2, 79% for PM2.5, 95% for EC, 85% for benzo[a]pyrene equivalent carcinogenic potency, and 66% for eight selected toxic elements (Pb, Cu, Sb, Cd, As, Ag, Se, and Ni) in PM2.5. Improvements in stove technology are demonstrated as a practical approach for improving TE and reducing emissions of hazardous pollutants and CO2.