The development of information for an emissions inventory can be carried out in one of two methods. One method is often referred to as the top-down approach. In the case of a top-down approach, generalized factors such as total fuel use, total population, total housing units, and total manufacturing jobs, for example, are used as indicators of emissions. Emission factors are developed that predict emissions per unit energy use or per person or such. The product of the emission factor with the relevant emissions indicator provides an estimate of emissions. These emissions can be disaggregated by location and time if the relevant emissions indicator factor, such as energy use, is known by some subdivision of the region of interest and/or by time. Total regional energy or other overall emissions indicators can also be used in combination with information about population or manufacturing jobs by sector of a region to allocate emissions to specific locations. It is more difficult to use this method to allocate emissions by time of day. The top-down approach is best used for emissions that impact global or very large regional scale problems; although it can be and has been used with respect to local air pollution problems.

A second method is often referred to as a bottom-up approach. In a bottom-up approach, the region of interest is divided into sectors of interest. Specific information is developed for each sector based on the specific industries, housing units, and vehicles that operate within that sector. This information is then used to estimate the emissions that will occur in each sector. A bottom-up approach requires considerably greater effort than the top-down approach, but it can provide more reliable and detailed data. However, it cannot be automatically assumed that a bottom-up inventory is better than a top-down inventory. An emissions inventory is no better than the accuracy of the input data and the care that is used to build the inventory.

It is common to use both top-down and bottom-up methodologies to develop a single emissions inventory. Emissions from specific well defined sources are often estimated using a bottom-up approach while emissions from more generalized sources such has housing units are estimated using a top-down approach.

In any case, it is important to determine in advance the desired spatial and temporal emissions distribution that is desired before the design of the emissions inventory database is begun.