The process of turbocharging increases temperature by compressing the fresh air in the turbocharger. As heated air takes up more space than cool air, the cylinders fill with less air than the system's boost pressure prescribes and the risk of knock in petrol engines also increases. For this reason, the compressed air is cooled by the engine's coolant or the outside air. The intercooler reduces the thermal load on the engine. At the same time, the exhaust-gas temperature, nitrogen oxide (NOx) emissions and fuel consumption are reduced.

Article source: www.volkswagen.co.uk