The refrigerated dryer mentioned in this paper is one of the most popular ones among compressed air dryers. It consists of a precool-reheater, a main cooler and a refrigerator. The steam contained in the compressed air condenses due to cooling in the main cooler and the precooling side of the precool-reheater. If the condensate is not completely separated and drained, the dew point of the compressed air at the dryer outlet will increase, not allowing for the expected air condition to occur. In this paper, the effect of separation and drainage of the condensate regarding dehumidification of a refrigerated dryer is clarified in relation to the rating capacity of each heat exchanger and air temperature in the dryer through theoretical and experimental investigations.