The primary function of the hypothalamus in temperature regulation is to maintain homeostasis by sensing and responding to changes in body temperature. When body temperature deviates from its set point, the hypothalamus activates mechanisms for heat production or loss. For instance, it can trigger perspiration for cooling or shivering for warmth. This critical role helps ensure optimal functioning of metabolic processes and overall physiological balance, making the hypothalamus essential in regulating the body's thermal environment.