Thermoeconomic analysis, a combined application of thermodynamic and economic analyses, has emerged as an important tool to optimize the performance of desalination systems. Contrary to conventional economic analysis, it offers flexibility to investigate and improve the performance of each component in the system, individually. The current paper presents a comprehensive framework for conducting thermoeconomic analysis of desalination systems. In this regard, different energy calculation methods are discussed first. Then a detailed review of theoretical developments of thermoeconomic analyses is conducted to summarize the correlations/magnitude of important economic parameters. This is followed by a discussion on cost balance equations for important desalination components. Finally, a systematic thermoeconomic analysis model is developed for the mechanical vapor compression desalination system operating under different arrangements as an example. The monetary value of each stream calculated using appropriate fiscal parameters in the system is presented in the form of a cost flow diagram. The study can be used to conduct the thermoeconomic analysis of other commercial desalination systems.