The LED light string is labeled for Indoor/Outdoor use but there is a warning on the box that the transformer must be indoors. That seems as though the light string is NOT suitable for outdoor use. I want to use this string on an outdoor holiday star with the power source connection an outdoor receptacle. Do I need to return these lights for Outdoor rated use lights? Is there a fire or electrical shortage shock risk with using these with the transformer outside?
Actually this warning can be for wire wound transformers and switching power supplies that do not have a protective shell where water and or moisture can damage the device. Adding a water / moisture tight enclosure with approved sealing grommets or bushings would be a code legal way to do this.
In most cases a NEMA 3R case will be sufficient. In all cases A NEMA 4 -4x weather proof is enough this is normally what we use in areas close to where vehicles are pressure washed or steam cleaned to protect the controls.