This lecture introduces the fundamental assumptions and local thermodynamic state of continuous media, including reduced extensive state functions and continuity equations. It covers the characterization of the local thermodynamic state by entropy and momentum densities, as well as other state variables. The lecture also discusses extensive physical observables and their variations, along with the physical causes of observable rate variations. The divergence theorem for a vector function is presented, leading to the continuity equation for a given observable. The concept of thermodynamic state fields, such as momentum density, is explored in detail.