Liam Drew in Slate:
Some of you may be thinking that there is a simple answer: temperature. This arrangement evolved to keep them cool. I thought so, too, and assumed that a quick glimpse at the scientific literature would reveal the biological reasons and I’d move on. But what I found was that the small band of scientists who have dedicated their professional time to pondering the scrotum’s existence are starkly divided over this so-called cooling hypothesis.
Reams of data show that scrotal sperm factories, including our own, work best a few degrees below core body temperature. The problem is, this doesn’t prove cooling was the reason that testicles originally descended. It’s a straight-up chicken-and-egg situation—did testicles leave the kitchen because they couldn't stand the heat, or do they work best in the cold because they had to leave the body?
Vital organs that work optimally at 98.5 degrees Fahrenheit get bony protection: My brain and liver are shielded by skull and ribs, and my girlfriend’s ovaries are defended by her pelvis. Forgoing skeletal protection is dangerous. Each year, thousands of men go to the hospital with ruptured testes or torsions caused by having this essential organ suspended chandelierlike on a flexible twine of tubes and cords. But having exposed testicles as an adult is not even the most dangerous aspect of our reproductive organs’ arrangement.
More here.