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The variation in daily environmental conditions has a notable effect on the thermal performance of the electrical machines, especially power transformers. The objective of this paper is to see the effect of solar radiation and wind flow external to the outdoor operating power transformers. The research work in this field involves the development of computational thermal models based on conventional International Electro-technical Commission (IEC) loading guide using appropriate software tools in order to determine the hot spot temperature. These thermal models are then modified by incorporating the effect of solar radiation and wind flow. The proposed method is validated using the operational data gathered from a 500MVA power transformer located at 400kV Grid Substation, Kankani, Jodhpur (Rajasthan, India). The comparative study between the conventional and modified thermal models helps in the reliable operation of power transformer and optimizes the use of forced cooling arrangements. [ABSTRACT FROM AUTHOR]