You are probably thinking that home theater systems are a luxury reserved for only the rich and fabulous, however, it can be as simple as a few AV devices in your living room.
Here is an excerpt from Home Theater Review’s guide on how to get yourself set-up and into the world of Home Theaters.
“When you envision a theater-like video experience, you probably think first of a projection system and a very large screen. That's certainly the display of choice in the prototypical home theater. The two-piece projector/screen combination is generally best suited for a dedicated theater room in which you can completely control the lighting, although many manufacturers now offer high-brightness projectors and ambient-light-rejecting screens that are specifically designed for use in brighter environments). Companies like SIM2, Barco, and Digital Projection International offer projectors and services targeted more at the high-end marketplace, around $20,000 and above. However, projectors aren't reserved solely for the wealthy. This type of display device can actually offer the best screen-size-to-cost ratio. Companies like JVC, Sony, Optoma, and Epson offer high-quality mid-level and entry-level projectors.
The other main element that makes a trip to the movie theater so memorable is the enveloping audio, in which sound elements come at you from all directions. At home, the most basic surround sound speaker system consists of 5.1 channels. The "5" stands for speakers in the front left, center, front right, rear right, and rear left positions, while the ".1" belongs to a subwoofer that helps flesh out the bass for explosions and other low-end effects. Some home theater installers recommend the use of multiple subwoofers to help deliver smoother bass response across a wider listening area. It's also popular to go with a seven-channel speaker system, which uses two side-channel and two rear-channel speakers for a more complete surround experience. The latest trend is 3D (or object-based) audio, in which formats like Dolby Atmos and DTS:X add an overhead sound element that provides an even more immersive audio experience.
The electronics are the brain of the home theater system. They receive the audio and video signals from your source devices and distribute them out to the speakers and display device. (Some video enthusiasts prefer to only feed audio through their electronics and send video directly from the sources to the display.) Electronics fall into two main categories: AV receivers and separates. An AV receiver puts everything you need in one chassis: One box contains all of the AV inputs to connect your devices, the processors that decode the audio and video signals for output, and the amplification that powers the speakers. Some popular receiver manufacturers are Denon, Marantz, Yamaha, Onkyo, and Pioneer. As the name suggests, the "separates" approach requires two boxes: a preamp/processor for signal input/processing and an amplifier (or multiple amplifiers) to power the speakers. The latter approach is more common amongst high-end audio enthusiasts who want more precise control over their system's performance, particularly in the amplification realm. Anthem, McIntosh Labs, Mark Levinson, Classe Audio, and Simaudio are examples of companies that offer high-end separates.”