Energy consumption all over the world is increasing day by day and there is need to develop new ways to conserve energy for future requirements. Air conditioner used in summer seasons, uses vapor compression refrigeration system which consumes large amount of power usually about 1.5 to 3.5 KW and is also very costly. This paper describes the design and fabrication of modified air conditioner with split cooling unit. Basically, it is portable form of central air conditioning system which uses a low power compressor (refrigerator) for cooling a chamber containing water. This cooled water is then circulated for air conditioning. Performance analysis shows that it produced decent cooling and reduced power consumption.