A vapor compression system including an evaporator, a compressor, and a condenser interconnected in a closed-loop system and a method of operating such a system. The method includes the conversion of expanded liquid heat transfer fluid from a liquid form to a high quality liquid vapor mixture before delivery to the evaporator. In one embodiment, the heat transfer surface of the evaporator coil is smaller than that required to obtain an equivalent evaporator capacity when the expanded liquid heat transfer fluid is not converted from a liquid form to a high quality liquid vapor mixture