A novel indirect evaporative chiller driven by outdoor dry air to produce cold water as the cooling source for air conditioning systems is introduced, and the principle and the structure of the chiller is presented. The cold water can be produced almost reversibly under ideal working conditions, with its temperature infinitely close to the dew point temperature of the inlet air. The key components of the chiller are an air cooler and a padding tower. To improve the heat transfer performance inside the chiller, a quasi-countercurrent air cooler was designed; a subsection linear method was used for the mathematical model of the padding tower. The first indirect evaporative chiller, designed and developed in 2005, has been in use in Kairui Building, a big hotel in Shihezi, Xinjiang Autonomous Region. The tested temperature of the water produced is below the wet bulb temperature of outdoor air and reached the average value of the dew point temperature and the wet bulb temperature of outdoor air. As the running components are only pumps and fans, the COP (cooling energy for room divided by power cost) of this chiller is high, and the drier the outdoor air, the higher COP the chiller obtained. Since no CFCs are used in this chiller, it would not cause any pollution to the aerosphere. Finally, the application prospect of the indirect evaporative chiller in the world is presented.