Prepare your work area. Lay down an old linen sheet or towels to protect your floors. Either remove furniture or place coverings over it to avoid damage during the restoration process. In addition to your floors and furniture, protect yourself by wearing long-sleeved clothing and safety goggles.
Examine your fireplace for problem areas like loose tiles or discoloration, for example. Determine what areas can be salvaged and what needs to be replaced. Then purchase those materials needed based on your assessment.
Remove any tiles or damaged wood framing you'd like to replace. Use a crowbar to pop off the loose tiles. You might need to break the tile first to make it easier to remove. In the case of rotted or cracked wood, replace the damaged areas with new lumber. Be sure to measure accordingly and cut the wood to reflect the original design. Use a wood filler to plug up any small holes in the framework. Once everything is dry and secure, sand the entire wood frame to prepare the surface for tiling or painting.
Decorate your fireplace. This is where you get to be creative. Select the tilework you'd like to use for enhancing the look of your fireplace. If you are staying true to the original design, replace any tiles by applying a layer of mortar to the surface and the back of the tile with a trowel. Firmly press your tiles in place and allow to dry for 24 hours.
Use your trowel to apply grout over the entire surface of the tile. Be sure not to neglect any adjoining areas, where cracks may require some extra application. Use your finger if necessary to fill them in. Use a damp cloth or sponge to remove any excess grout from the surface and allow to dry overnight.
Paint your wood framing and mantelpiece as desired using an interior latex product. Choose your colors carefully to harmonize the color scheme of your living space. Once your first coat has dried, apply a second coat of paint and allow to dry once again.