Generally, electric heaters were used. These were typically portable plug-in heaters, and were used in workspaces and in officers' and petty officers' rooms. These were very useful when operating in cold waters.
At least some boats had steam heating systems, where steam could be supplied by an external system for heating when in port. The steam could be supplied by a fixed installation at a base, or by a depot ship.
The diesel engines would also heat the boat when in use. In cold waters, this was a Good Thing, and in warm waters, rather undesirable, since temperatures in the engine room could exceed 50C.
Some late U-boat models had air conditioning systems, which could be used for heating as well as for cooling. These would also have reduced humidity, which was normally very high in non-air-conditioned boats, to the point where leather stuff would go moldy. Type XB, XIV, and XXI had air conditioning.
For some details about heating systems, see:
For non-air-conditioned boats:
(You can search the text for "heating", but note that most of the mentions are for heating components in the electrical systems, so skip past those.)
For air-conditioned boats:
(Search for "air conditioning".)
Great question, and I see at least one good answer has already been provided by u/wotan_weevil. I will try to build upon it. The below answer applies exclusively to Type VII and Type IX U-boats, which together comprised most of Germany’s U-boat fleet during WWII:
One might think that the interior of a WW2 U-boat was very hot, and it was—except when it wasn’t. They had no cooling capability and limited heating capability. Unsurprisingly, it could be either very hot or very cold, depending on what part of the boat you were in, the outside water temperature, and whether it was submerged or not.
If a U-boat was traveling in the open Atlantic in northern latitudes then it was generally quite chilly aboard. The Atlantic is frigid and it draws heat effectively out of a metal tube, whether submerged or not, so the internal temperature of a U-boat was similar to that of the surrounding water. Space heaters provided some warmth but were generally considered of limited effectiveness.
The crew was generally bundled up when on patrol in cold waters. One enlisted sailor aboard the U-109 wrote that “It was so cold in the boat that I was wearing my entire seaboard wardrobe: thick winter underwear, dark blue woolen combinations, grey moleskin suit and then U-boat leathers with a sheepskin.” The diesel engine room was warmer, although this did not do much to warm the rest of the boat.
I dive WW2 wrecks off New Jersey, and bottom temperatures of 49 degrees are the norm…in the summer…and those are “warm” coastal waters. That would have been quite comfortable by Atlantic standards, as a U-boat sat on the bottom during daylight hours waiting for night to fall (as happened every day off the US East Coast during the first half of 1942.) But farther north and east, and in winter months, Atlantic temperatures are closer to freezing. This is especially true of the waters nearer to Iceland and Greenland where many of the large convoy battles were fought.
U-boats often operated in warmer waters, however, such as the Caribbean or the Gulf Stream off North Carolina. Here, the interior of the boat became intolerably hot. The engine room was particularly sweltering, reaching temperatures of 122° Fahrenheit / 50° Celsius and even higher. U-boats did not have air conditioning, but the crew did have one means of relief: upon surfacing in warmer waters they opened the hatch while keeping all the air intakes closed, then briefly ran the diesel engines at high speed. This sucked in a surge of cool sea air through the hatch while sucking out much of the hot air & stank aboard.
A sailor from the U-505 (which is currently in a museum in Chicago) wrote about the conditions aboard while operating in the South Atlantic. “As we crossed the Tropic of Cancer, the boat began to heat up like a furnace during the daytime…we used every imaginable excuse to get out onto the deck and escape the roasting temperature inside the hull. When we dived, the ocean water cooled the pressure hull, causing drops of condensation to rain down upon us.”
Sources: Hirschfeld: The Secret Diary of a U-boat by Brooks & Hirschfeld, p. 135; Steel Boat, Iron Hearts by Goebeler & Vanzo, p. 21; Operation Drumbeat by Gannon, p. 111