Optimal sperm production requires a slightly lower temperature than inside the body, which is why the testes are located externally. The testes retract into the body during cold temperatures for the same reason— optimal sperm production requires a precise temperature.
An Argentinian study showed that frequent use of laptop computers decreased sperm production and sperm movement (a measure of sperm health). They also found that prolonged laptop use caused DNA damage in the sperm. If your goal is to have healthy children, use a temperature guard such as a towel or lap protector when using a laptop computer.
Source: Paper presented at American Society of Reproductive Medicine meeting, October 27, 2010