Producing region and legal definitions
The region of cognac, divided up into six growth areas, or crus (singular cru), covers the department of Charente-Maritime, a large part of the Charente and a few areas in Deux-Sèvres and the Dordogne. The six crus are, in order of decreasing appreciation of the cognacs coming from them: Grande Champagne, Petite Champagne, Borderies, Fins Bois, Bons Bois, and Bois Ordinaires.A cognac made from just the first two of these crus (with at least 50 percent from Grande Champagne) is called "Fine Champagne" cognac, although no cognac has anything to do with the sparkling wine Champagne. ("Champagne" coming in both cases from old words alluding to agricultural fields.)

If a brandy is produced that fails to meet any of the strict criteria set down by the "governing body" of cognac, the BNIC – Bureau National Interprofessionel du cognac – it may not be called cognac, nor sold as such.

It must be produced within the delimited region, from wine using certain grape varieties;
It must be obtained through double distillation, in typical copper Charentais stills;
It must age in oak barrels, which give it its color and part of its taste.
Many of the cognac producers in the town of Cognac and the surrounding area allow visitors taste their product; the bigger companies have guided tours to show visitors how the cognac is made.

Process of fabrication
Cognac is made from eaux-de-vie (literally, "water of life") produced by doubly distilling the white wines produced in any of the growth areas. The wine is a very dry, acidic, thin wine, not really suitable for drinking, but excellent for distillation. It may only be made from a strict list of grape varieties. Distillation takes place in traditionally shaped Charentais copper stills, the design and dimensions of which are also controlled. Two distillations must be carried out; the resulting eau-de-vie is a colourless spirit of about 70 percent alcohol.

Cognac may not be sold to the public, or indeed called 'Cognac' until it has been aged for at least two years, counting from the end of the period of distillation (1 April following the year the grapes were harvested).

During the aging, a large percentage of the alcohol (and water) in the eaux-de-vie evaporates through the porous oak barrels. This is termed locally the "part des anges", or angels' share, a phrase also used in Scotch Whisky production. A black fungus, Torula compniacensis richon, thrives on the alcoholic vapours and normally grows on the walls of the aging cellars.

The final product is diluted to 40 percent alcohol content (80 proof).

The age of the cognac is shown as that of the youngest eau-de-vie used in the blend. The blend is usually of different ages and from different local areas. This blending, or marriage, of different eaux-de-vie is important to obtain a complexity of flavours absent from an eau-de-vie from a single distillery or vineyard. Each cognac house has a master taster (maître de chai) who is responsible for creating this delicate blend of spirits, so that the cognac produced by a company today will taste exactly the same as a cognac produced by that same company 50 years ago, or in 50 years' time. In this respect it may be seen to be similar to a blended whisky or non-vintage Champagne, which also rely on blending to achieve a consistent brand flavour.

Grades include
VS (Very Special) or *** (three stars), where the youngest brandy is stored at least two years in cask.
VSOP (Very Superior Old Pale), Réserve, where the youngest brandy is stored at least four years in cask.
XO (Extra Old), Napoléon, Hors d'Age, where the youngest brandy is stored at least six years in cask.