Symptoms of Overheating
As your console gets hotter, the fan will spin faster in an attempt to lower the temperature; if you hear the fan getting louder, take this as a sign that you need to move, and possibly clean, your system. If its temperature gets too high, the power lights on your PS3 will flash red and green. Turn off your system and let it cool before cleaning and moving it to an open location with plenty of surrounding space and unobstructed by household items or other electronics.
Effects of Overheating
Heat can warp and damage the sensitive components inside your console, leading to malfunctions while the system is operating. If they're exposed to high enough heat, or high heat often, these components can become too damaged to work. Heat inside the console will make the PlayStation 3 hot to the touch, and may cause burns. Extreme overheating can even lead to fires.
Avoiding PS3 Overheating
Clean your PS3 regularly, as dust is an insulator that adds heat. Compressed cans of air are effective for removing dust from fan openings and USB ports; you can also use a gentle vacuum cleaner attachment. Place the PS3 where it will have room to circulate air. Placing it flush against a wall or enclosed in an entertainment center while running will cause your console to heat up. Keep your PlayStation 3 away from curtains, off cushions and off the floor to avoid build-up of dust and air-flow obstruction. Do not smoke around your console, as residue from smoke can coat the components inside your PS3. If you've removed the hard drive in your system, do not forget to replace the cover, since running the system without the cover can cause heat build-up.
Cord Safety
Sony cautions against using an inverter or transformer with the provided PS3 AC power cable, as this can cause the console to heat up. Keep your power cord away from heat; damage to the power cord can cause damage to your PS3. Also, using an Ethernet cable other than those compatible with 10BASE-T, 100BASE-TX or 1000BASE-T can cause heat build-up in the console, along with other system issues.