Why does my air conditioner smell? The most common bad smell from your cars A/C unit is a moldy odor. This is a sign of mildew or fungus is growing in or around the air conditioner. It's really not that surprising. After all, in addition to cooling the air in your car, air conditioners also remove excess moisture. If it's not drained away properly, mold may begin to grow on areas with lingering moisture. Something as simple as a dirty filter can cause the smell of mildew. The "cabin filter" in your car should be serviced every 15,000 miles or once a year. During this service the technician can check the "evaporator" drain for proper flow as well.