What is a Scene Heading in a screenplay?

The Scene Heading or slugline is a line of text describing the new settings of a scene.
There are three components presented in the following order (left to right): Camera position (INT or EXT), the location (the address) and the time of day (NIGHT or DAY). The slugline introduces the new scene and provide quick access to importantt information such as whether to shoot in interior or duuring the day. Typically the sluglines in a screenplay, help identifying the budget for the production.
The way a scene heading is formatted changes slightly from country to country, we will refer here to the American Standard.
The scene heading is also known as 'Master Scene Heading'.

How to write a scene heading: INT. ROOM #1 - NIGHT

The camera position
It describes whether the scene occurs inside or outside. It is written in capital letters followed by a dot.

Typical values:

INT. it is used for interior.
EXT. it is used for exterior.

Additional allowed configurations are: INT./EXT., EXT./INT.
The camera position text could also be configured to represent particular situation such as in the space: 'SPACE.'.

The location
The location presents the geographical address at which the events occur.
It could be very specific such as: 10, LONDON STREET, APT. #5 or represent a type of scenary: IN THE FOREST, AT THE BEACH, IN A HOTEL ROOM.

The time of day
It describes when the events occur, if during the day or at night.
This component can be used also to represent a flashback (or a flash forward) or a smooth transition from one scene to another (SAME, CONTINUOUS).
It could be used to represent concept of time such as: DAY #1 but most of the time, to preserve clarity, it will be either DAY or NIGHT.

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Examples

INT. ROOM 1 - NIGHT: The events occur at night in a generic room.
INT. ROOM 1 - SAME: We use 'SAME' when the events occur at the extact same time as the previous scene. This does not imply any continuity with the previious scenes (action or characters).
INT. ROOM 1 - CONTINUOUS: We use 'CONTINUOUS' when the action or the characters are continuing from previous scenes and time.
INT. ROOM 1 - FLASHBACK: The flashback keyword can be presented alone or together with additional information: - NIGHT (FLASHBACK)

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