Cold Air Intake (CAI) is cold air brought into your engine from outside the engine bay. Hot Air Intake is air brought into your engine from inside the engine bay. I learned this from my post a while ago about the AEM CAI. Cold air is better (I think), but everybody says that you will hydrolock your car. But from who I talked to, people that have had it for years, said that its not that big of a risk. You pretty much have to run through a 3-4ft puddle and sit in it and get the filter totally in the water for it to hydrolock. But I wouldnt know becuase I havent ordered my CAI yet.