Some rustic sheds intended to hold tools and unimportant storage items might not require insulation. However, an insulated exterior building is still a good value, and useful as well. An insulated shed can easily convert into a playroom, or an area ideal for a workshop or craft room. With heating or cooling added, you can make it fairly comfortable. You can fill the interior cavities with styrofoam insulation, cut to size and glued into place with construction adhesive. Or, go a little further and install fibreglass insulation.
Construct furring strips in sheds without interior framing, unless your shed is a metal storage shed. Use 1-by-2-inch or 1-by-3-inch boards, or 2-by-4 boards turned on end so the flat side goes against the wall. Cut to size as needed, using a circular or hand saw. Run a furring strip along the upper wall, pushed against the ceiling, to create a header plate. Repeat along the floor to make a footer plate. Attach with a thin bead of construction adhesive; secure along the walls with masonry screws driven into the wall with a drill.
Add vertical furring strips to fit the floor to ceiling height. Measure and subtract about 1/4 inch from the height to allow room to slide the furring strip in place. Space every 16 inches along the wall and secure with masonry screws. Place a furring strip in each corner of every wall, with the strips butted up to each other to create an L-shaped construction.
Cut fibreglass insulation to fit each wall section between studs or furring strips. Use a utility knife and cut with a wood board underneath the insulation to avoid dulling your knife. Insert each piece of insulation, with the faced-side out toward you, in the wall sections. Pull the paper over the wood stud or furring strip and staple into place. Avoid unnecessary holes or joints in the fibreglass--it is better to use unbroken pieces of insulation whenever possible.
Cover the insulation, once you are finished, with a plastic moisture barrier (also known as a vapour barrier). Staple it to the wall studs where it crosses the wood. Tape any seams or tears in the barrier to prevent air or moisture from penetrating. Some fibreglass insulation products have an attached barrier, and you may be able to skip this step if so.
Finish with a wall covering over top. Install drywall or panelling, as desired. Install the material flush with the ceiling and floor. Nail or use screws to attach.
A thin-walled metal shed without interior (wood stud) framing is best insulated with styrofoam insulation, held up to the wall and glued with construction adhesive, because it can not be effectively framed with furring strips or stud walls. Tape any joints with styrofoam tape when complete. Wood-framed shed walls and thicker smooth-walled structures such as brick and concrete can accommodate fibreglass insulation for superior insulating power. Seal any leaks and holes, if present, before insulating your shed. Use caulk and expanding foam insulation as needed. Consider insulating your floor and ceiling as well. Use styrofoam insulation sheets and lay the insulation on the interior side of the existing floor or ceiling, covering with a vapour barrier and flooring or ceiling material.
Consult local building codes for any local requirements before insulating your shed. Always use precautions when working with fibreglass, as it is spun glass material and can prove hazardous to your health.