We all know the saying "From High to Low, Look out below" Some were taught that this only applied to pressure differences and thus were instructed to get a new altimeter setting every 100NM or so. This is a good recommendation.
Temperature differences from standard also causes errors with the altimeter. The same saying above holds true with temperature variations.
An altimeter setting is defined as: (ref. Pilot/Controller Glossary)
The barometric pressure reading used to adjust a pressure altimeter for variations in existing atmospheric pressure or to the standard altimeter setting (29.92).
We also know there is a direct correlation between pressure and temperature and thus an altimeter setting is corrected for both pressure and temperature. This means one thing, the altimeter error is zero at the field elevation. As the aircraft gets climbs higher above the field, the altimeter error will increase.
There is a table in the Aeronautical Information Manual (7-2-8) that lists altimeter error due to temperature as a function of altitude (AGL) and temperature.
Here is the formula that will give you this table. The formula can be found in Canadian Aeronautical Information Manual (RAC section).
The United States Air Force has a PowerPoint that discusses this topic.
The FAA has recently come out with Info 15002 which requires pilots (after 9/17/2015) who fly into "Cold Temperature Restricted Airports" to correct their altitudes for colder than standard temperatures. To determine if your airport is part of this program you must go to the Aeronav FAA website and search for Cold Temperature Restricted Airports. There should be a link at the bottom of the page.
Here is a graphic showing all the airports in the United States that were part of the program in February 2015.
Because Lnafziger wanted Alaska.
Not only is the pilot required to correct for the segment but they are also required to inform ATC of the new altitudes they will fly. This is to ensure traffic separation with other airplanes who are not temperature correcting their altimeters.
Pictures taken with permission from All About Airplanes blog. All rights reserved.