Despite being efficient water heating technologies, conventional absorption heat pumps can hardly produce hot water with temperature over 90 °C, and compressor-based systems have low primary energy efficiency. In order to fill this temperature gap and improve the energy efficiency, a gas-fired ammonia-water absorption heat pump with intermediate process is proposed to supply hot water with large temperature lift for residential and industrial applications. In addition to the ambient heat utilized in the evaporator, the proposed system recovers the exhaust heat in the intermediate evaporator, and the evaporated ammonia vapor is absorbed in the intermediate absorber to further heat the water, which is initially preheated in sequence in the condenser, rectifier and absorber. Simulation results indicate that at the ambient temperature of 20 °C, the proposed system can produce hot water with temperature over 95 °C and the obtained temperature lift is 75 °C, while the primary energy efficiency is 1.38. Obtained results indicate that the intermediate pressure of 0.7 MPa is the optimum pressure from both thermodynamic and economic aspects. Moreover, it is found that the energy saving potential of the proposed system is in range of 36.7% to 43.5%, when the comparison is made with conventional gas-fired boilers, and the average payback period is 3.0 years in three typical cities of south China. It is concluded that the proposed system is an efficient scheme for high-temperature water heating with large temperature lift. This is especially pronounced in warm regions with average ambient temperature over 5 °C.