From detailed experimental measurements on commercial reciprocating chillers, the loss mechanisms that dominate chiller performance can be identified, quantified and incorporated into a general irreversible thermodynamic model for predicting chiller behavior. The data can also be used to demonstrate the weaknesses and inaccuracies of a host of endoreversible chiller models that have been presented, where the primary sources of internal dissipation have been ignored. We quantitatively establish the dominant contributions to chiller performance of internal irreversibilities, such as fluid friction in the compressor and evaporator, and of finite-rate heat transfer at the heat exchangers. Heat leaks are measured experimentally and shown to be close to negligible. The empirical wisdom that has evolved in the commercial production of reciprocating chillers, namely, that rated capacity operation corresponds to near maximum efficiency, is explained in terms of a general thermodynamic model. Taking account of constraints of heat exchanger size and cost, we use experimental data to show that simple thermodynamic modeling can account for the optimal designs that are produced by the chiller industry.