The MCP9808 can work with input voltages of 2.7V to 5.5V. 

The actual input that you choose to provide depends on the device you use to drive it. In our case, we are using an Arduino Uno, which has 5V logic. This means that the Uno's digital pins "understand" HIGH and LOWs that are between 5V and 0V.For the Arduino Uno, then, you must supply the 5V voltage to the sensor, so that the sensor can use these levels of its communication with the Arduino.

If you were using this sensor with an Arduino 101, for example, which has 3.3V logic, then you would supply 3.3V to the same sensor. This way the sensor will be using the correct voltages for its communication with the Arduino 101.

This sensor is digital, and contains all the necessary circuitry inside to make sure that whichever input voltage you supply, its accuracy will not be effected (as long as the input voltage is within the manufacturer's specifications).

The same principle applies to virtually any digital sensor that is capable of using a range of input voltages.