Numerical simulations are performed to understand the early thermal evolution and planetary scale differentiation of icy bodies with the radii in the range of 100–2500 km. These icy bodies include trans‐Neptunian objects, minor icy planets (e.g., Ceres, Pluto); the icy satellites of Jupiter, Saturn, Uranus, and Neptune; and probably the icy‐rocky cores of these planets. The decay energy of the radionuclides, 26Al, 60Fe, 40K, 235U, 238U, and 232Th, along with the impact‐induced heating during the accretion of icy bodies were taken into account to thermally evolve these planetary bodies. The simulations were performed for a wide range of initial ice and rock (dust) mass fractions of the icy bodies. Three distinct accretion scenarios were used. The sinking of the rock mass fraction in primitive water oceans produced by the substantial melting of ice could lead to planetary scale differentiation with the formation of a rocky core that is surrounded by a water ocean and an icy crust within the initial tens of millions of years of the solar system in case the planetary bodies accreted prior to the substantial decay of 26Al. However, over the course of billions of years, the heat produced due to 40K, 235U, 238U, and 232Th could have raised the temperature of the interiors of the icy bodies to the melting point of iron and silicates, thereby leading to the formation of an iron core. Our simulations indicate the presence of an iron core even at the center of icy bodies with radii ≥500 km for different ice mass fractions.