What are the differences between oil-filled and dry-type transformers?

Oil-filled transformers use insulating oil for cooling and insulation, providing better heat dissipation and higher efficiency, especially in larger units. They are typically used in outdoor applications due to environmental concerns. In contrast, dry-type transformers utilize air for cooling and are often used indoors, offering lower maintenance and reduced fire risk. However, they generally have lower power ratings and may require more space for adequate cooling.