Vapour absorption heat transformers (VAHT) are thermally operated systems, capable of upgrading waste heat or any low-grade energy such as solar and geothermal energy into useful levels. This paper presents the entropy generation minimization analysis of vapour absorption heat transformer system with water/lithium bromide as working fluid pair. A mathematical model has been developed to predict the performance of the system along with the entropy generation at various operating conditions, such as temperatures of components. Thermodynamic properties of each point in the cycle are calculated using related equations of state. The results show that higher coefficients of performance (COP) values are obtained at higher generator temperatures and lower condenser temperatures. At higher generator temperatures, total entropy generation of the system increases. Maximum entropy generation occurs in the condenser at various operating conditions. The minimum entropy generation conditions, leading to the maximization of the COP are located.