All major religions that I know of, talk about Heaven and Hell. So does Hinduism.
I will try to throw some light on the same as per my limited knowledge and understanding.
Heaven in Sanskrit is called Swarg, if you do a "Sandhi Vichched" you get "Swa" + "Varg". Hence Swarg is short for Swa-Varg. What is this Swa-Varg?
Swa means self and varg means state.
Human body is supposed to be made up of "Panch Mahabhuta" - The Five Great Elements - Fire, Air, Water, Earth and Space. In Swa-varg, each of these 5 great elements are in their original state. There is order, not chaos. This is Swarga - the Heaven. Everything is in order, entropy is Zero. Everything is at peace with itself.
Now what is Narak? Narak is short for "Nar-kaaya". Basically when you need a body made of the 5 Great Elements to do your work and achieve your tasks, you are in Narak. So when we are on earth is it a Narak? Well, thats a wonderful question ;) which is debatable.
How about think of World as different levels of a VideoGame. Every level is Earth or Narak based on the level below or above. But yes, there is an Ultimate level of Order and peace and that is Swarg, the heaven, the abode of God.
If you go by ManuSmriti and a few other Shashtras, you will get different types of Narakas. Like I said - Levels in a VideoGame ;)
Those are all ancient texts and not a single person exists today who can claim to be able to perfectly interpret everything. Hence, we need not get into literal translations as words can be mis-leading. For example in Hindi "Jal" can mean water, at the same time, it can also mean "Burn" or sensation of burning.
So lets not get into complexities of those things. Lets Keep it Simple.