Hot water heaters can use electricity, gas, and solar energy to heat up water to a specific temperature. The systems all have in common the thermostat. Technically, most water heaters have two thermostats -- one at the top of the tank and one at the bottom -- so they can compare temperatures and make necessary adjustments. While few people adjust these thermostats, they remain a vital part of water heater operations, and problems with thermostats will quickly affect all the systems.
A surprisingly common issue with thermostats is improper settings. Some water heaters come from the manufacturer with the wrong water heater settings. Many tank thermostats have simple dial mechanisms that can be jostled or moved over time, changing the way the thermostat reads. If your water is too hot or too cold, check your thermostat settings before assuming anything is wrong.
Thermostats are attached via brackets to the side of the water heater tank. Sometimes the sensors that measure the water temperature can become loose and lose full contact with the tank. When this happens, the thermostats read that the water is actually cooler than it is since air is interfering with the heat transfer process. The water heater then increases the water temperature too high, sometimes to unsafe levels.
If the water becomes too hot too quickly, the upper thermostat will "trip" or stop the water heater from working automatically. The thermostat has a high-limit feature that goes into effect if the water at the top of the tank becomes too hot. Water above a certain temperature can easily explode into steam and cause damage to the system. When the thermostat trips, the water heater will stop working entirely until you can solve the problem.
Electricity and electrical currents are key to the operation of thermostats. The thermostats can experience electrical failure in many different places. The sensors themselves can fail as can the wires connecting them to the rest of the system. If an electrical failure occurs, your only recourse is to have a professional test and replace the malfunctioning parts.