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The implementation of renewable energy sources and heat pumps with natural refrigerants in the existing 3rd-generation district heating (DH) systems is a promising technology for the conversion to a 4th-generation DH system. This paper aims to investigate this transition through a case study for the existing DH system in Croatia. The district of Rijeka, which is considered in the case study, has an existing 3rd-generation DH system with a capacity of 9.2 MW, which was originally designed for a temperature regime of 130/70 °C and produces thermal energy from natural gas. In order to use heat pumps efficiently in such a system, the temperature of the distribution system and the energy consumption should be reduced. Trnsys software was used to perform complete dynamic simulations of the DH system. Used baseline models were validated according to the actual energy consumption reported by the heat supplier. The application of heat pumps with natural refrigerants in combination with on-site electricity production (PV system) can almost eliminate system CO2 emissions, reduce primary energy consumption and lower operation costs. Simulations were performed for 18 different scenarios that included 2 different building envelope variants. The results were compared, then discussed and conclusions were drawn. [ABSTRACT FROM AUTHOR]