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Cutaway of radiator cap and reservoir.
The radiator cap actually increases the boiling point of your coolant by about 45 F (25 C). How does this simple cap do this? The same way a pressure cooker increases the boiling temperature of water. The cap is actually a pressure release valve, and on cars it is usually set to 15 psi. The boiling point of water increases when the water is placed under pressure.
When the fluid in the cooling system heats up, it expands, causing the pressure to build up. The cap is the only place where this pressure can escape, so the setting of the spring on the cap determines the maximum pressure in the cooling system. When the pressure reaches 15 psi, the pressure pushes the valve open, allowing coolant to escape from the cooling system. This coolant flows through the overflow tube into the bottom of the overflow tank. This arrangement keeps air out of the system. When the radiator cools back down, a vacuum is created in the cooling system that pulls open another spring loaded valve, sucking water back in from the bottom of the overflow tank to replace the water that was expelled.