I use tiny 13'' Windows laptop for work and whenever working from home would like to use my 27'' iMac as a display to it.
Is this possible? Would HDMI->Thunderbolt cable do the trick? Is there anything more required?
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You cannot transmit the output of your Windows screen through an iMac display, but there is one way to work that you may find quite appealing: Microsoft Remote Desktop.
MS has a remote desktop client application that is a free download from the App Store. On your Windows machine, you change System preferences in Control Panel to enable remote access. In the Remote Desktop app on your iMac, you create a machine profile that specifies the Windows computer name or IP address, your account username and your password. It supports fullscreen mode, so your Windows login will be plenty big on your 27" display.
I use the application daily to remotely administer Windows desktops and servers all over the country. From the comfort of my MacBook.
Depending on the model of your iMac, you can use the mini-display port as an INPUT and change the imac into monitor mode to use it as an external display.
This IS compatible with any Operating System, as long as the graphics adapter can support the resolutions that the iMac can support.
This feature is called Target Display Mode, and can be accessed by pressing COMMAND-F2 on your keyboard once the cable is connected.
Here is Apple's notes about it: http://support.apple.com/kb/HT3924
I use one of these to connect to my gaming PC, connected to a DVI cable. http://store.apple.com/us/product/MB570Z/B/mini-displayport-to-dvi-adapter
I would suggest that you go with Trane Francks' answer to use Microsoft Remote Desktop. RDC is one of the crown jewels of Microsoft. It is so much better that VNC. I wish my Mac's and Linux systems had RDC. (Well, Linux does have X11, which is close.) Using RDC over a fast local network will feel almost like being directly on the computer. You may not even notice if you are running Office type applications. The only exception is things like video and games, but even here I have been often surprised at how well RDC works.
However to directly answer your question, a 27" iMac can be used as an external screen, but only with other Thunderbolt systems which limits this mostly to other Mac's. A HDMI to Thunderbolt converter will not work. (Unless, someone has recently created a much smarter adaptor.) Apple calls this "Target Display Mode" which is only available on 27" iMac's. Pre-Thunderbolt systems used Mini DisplayPort and were much easier to use with other systems.
A great explanation: http://www.tekrevue.com/tip/ins-outs-imacs-target-display-mode/
And Apple's own docs: http://support.apple.com/kb/HT3924?viewlocale=en_US&locale=en_US
There is solution for Windows 10 - "Screen Mirroring"
Your Target iMac should run Windows 10 thru Bootcamp and you have to change a few settings on the receiver computer:
This computer also can be used as a screen for other Windows PCs and phones.
To project computer make sure that both the computers are on the same local area network, on the PC whose screen is to be projected, go the ‘Action Centre’ and hit ‘Connect’. Find receiver computer in this list and Select the device and hit ‘Connect’.
On receiver computer click ‘Yes’ to allow connection. You may be prompted to enter the PIN displayed on the receiver computer. Once the connection has been established, you will be able to see a new window containing the screen output from the second computer.
From the standard four projection modes: ‘PC Screen Only’, ‘Duplicate’, ‘Extend’ and ‘Second Screen Only’ select needed.
Also, you can allow input from a keyboard or mouse connected to the receiver computer.
Functionality was introduced in Windows 10 v1607 you can project from non-updated Windows computer, but you need to have your receiver computer fully updated.
Here is the video how to do so: https://www.youtube.com/watch?v=TpnehuBO5AE&t=323s
I recommend using software called TightVNC to achieve this, all you need to do is install TightVNC server on your PC, set-up the server, and then connect using VNC with your Mac. For more information, I suggest you visit TightVNC.com.
I know you are referencing a laptop, but I thought I'd add a success on this today using a Dell XPS to my Late 2009 Imac 27":
Used a Diplayport-->MiniDP connector Dell-->Imac
In BIOS, switched to Intel Graphics (bypassing GeForce 745 installed card) Worked just fine. Major issue troubleshooting why the installed card would not work, and I'll have to see if there's a reason why.