This paper presents analysis and evaluation of the impact of size and voltage scalability of on-chip temperature sensor on the accuracy of hotspot monitoring and temperature estimation in dynamic thermal management of high performance microprocessors. The analysis is based on both the layout level and the system level across state-of-the-art sensors in terms of accuracy, voltage-scalability, and silicon footprint. Our analysis shows that a sensor having compact footprint and good voltage scalability can be placed on exact hotspot locations, typically among digital cells, significantly improving accuracy in tracking hotspots and estimating temperature of microarchitecture blocks, as compared to two other sensors that have higher sensor-circuit accuracy, large footprint and little voltage scalability limiting flexible placement.