Server's capabilities are increasing at or beyond the rate of performance improvement gains predicted by Moore's Law for the silicon itself. The challenge for the Information Technology (IT) owner is housing and operating all of this computational power in the Data Center. With more computational power in each unit volume, the industry is experiencing a significant increase in power density and hence a greater cooling challenge. The ability to now tackle computational tasks that were previously unattainable has driven energy costs to new levels. Methods to reduce the energy used in cooling these machines are being studied throughout the industry. One of the areas being considered is increasing the Data Center server ambient inlet temperature. ASHRAE [1] suggests a recommended limit of 20 - 25 degrees C for the most advanced Data Centers. There is a belief that operating at the high end of this range or above it will reduce the total power use in the Data Center by making the cooling system more efficient. A thermodynamic analysis clearly indicates that increasing the temperature of the high temperature heat source, while holding the lower temperature heat sink constant, will give an efficiency gain to the heat removal from the system. Unfortunately the simple model does not capture all of the components of the overall system and may lead to an erroneous conclusion. In fact, increasing the ambient temperature can lead to an increase in power usage of some components and systems in the Data Center as temperature goes up. The overall room energy use may only go down marginally or may even go up at warmer temperatures. In this paper we examine the complete energy picture from the utility connection to the rejection of heat from the facility to the outdoor environment and look at the impact an increased ambient temperature will have on each component in that chain. This analysis indicates that there is an optimum temperature for Data Center operation that will depend on each Data Center's individual characteristics, include IT equipment, cooling system architecture, Data Center location (e.g. outside ambient conditions), as well as other factors. Additional impacts of an increasing ambient inlet temperature, such as reliability issues and operational complexity are also discussed. It is concluded that simply raising the ambient temperature in the Data Center may not have the desired effect of energy use reduction.