Yes, a window air conditioner has to be installed outside. The reason for this is that an air conditioner needs to exhaust hot air from inside your home in order to work properly. If the unit were installed indoors, the hot air would simply recirculate back into your home. By installing the unit outdoors, you ensure that the hot air is expelled properly and that your home stays cool.
Window air conditioners can be installed inside or outside your window. The main difference between the two is that an inside-mounted unit will block your view out of the window, while an outside-mounted unit will not. Window air conditioners are typically cheaper to install than split systems, but they are less efficient and tend to be noisier. If you're looking for a cheaper way to cool your home during the summer, a window air conditioner may be the right choice for you. Just make sure you measure your windows to make sure the unit will fit!
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