Originally Posted by radodrill
The correct term is an evaporative cooling tower; and yes they do work. Evaporative cooling is very commonly used in an industrial environment to cool pumps and other equipment. The one downside, which has already been mentioned, is that the water does evaporate so the level in the reservoir has to be closely monitored; this is why industries that use a lot of evaporative cooling often have a lake/pond (often artificial) nearby to ensure they have an adequate water supply.
The other major downsides are:
1) contaminants will enter loop
2) Noisy (sound of water raining)
3) Increase humidity (assuming indoor)
4) Performance is temperature and humidity dependent
However, evaporative (aka bong, swamp) cooling can get you sub-ambient temps.