Outdoor low voltage lighting

I just bought a 300 watt transformer and lights for some lights along the walkway to my house.
When I got it home, it said to only install the transformer outdoors.
I have an old house. It has stone walls that are around 18 inches thick at the ground line. I was planning on putting the box inside in the basement, and running the cable out a hole I would drill in a wooden window frame that is down near the foundation.
What is the issue with having this installed outside? Do the transformers get very hot?
Mac
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William McHarg wrote:

bet they tell you that as it is for outdoor use(rated that way meaning that it is not rated for just indoors)... ever see the china instructions for christmas lights: for indoor - outdoor use only... or other instructions for lights that say: not to be put in mouth... or someother stupid instructions??? if you can use it outdoors then you can use it indoors... on the indoor stuff it cannot be used outdoors as it is not moisture proof and will or might short out.....
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