Thermostat location1998 bettle - 1998 Volkswagen Beetle

VW Bugs use a tiny accordion looking thermostat that is attached to shutters on the fan shroud. When cold the thermostat pulls the shutters closed to impede the flow of cooling air. When hot the thermostat expands and pushes the shutters open to allow airflow over the engines cooling fins. Changing it is a piece of cake and in fact much easier than the original answer. It's done from the bottom of the engine. It's the only accordian looking thing under the car. You will need to remove a piece of cooling tin on the bottom of the motor to get access to it so in addition to a flashlight and screwdriver bring a 10mm wrench. (Now would also be a good time to get a couple cans of brake clean and use them to clean off the oil and dirt on the bottom of the engine and cooling fins). If you have further questions or need more instruction I strongly reccomend you get a used Muir Manual from Amazon and thumb through the section on cooling. In my opinion VW Bugs should have been equiped from the factory with the Muir Manual.