Today there is a tendency to disbelieve in the need of purification after death because we have lost the sense of God's Holiness and man's sinfulness. His holiness is affirmed in Psalm 99:5 which reads, "Exalt the LORD, our God; bow down before his footstool; holy is God!" Just because God is merciful, it does not mean that He is less Holy. That God is Holy is not an attribute of God but the very essence of God.
The Holiness of God is manifested in various ways in the Scriptures. We see Moses who is told to remove his sandals at the Burning Bush because he was standing on holy ground. Isaiah realizing that he was standing before the Holy God cried out " "Woe is me, I am doomed! For I am a man of unclean lips, living among a people of unclean lips; yet my eyes have seen the King, the LORD of hosts!" (Is 6:3,5) In Isaiah even the angels shields their faces from God's glory signifying that that they can never forget that they are creatures. At the time of David, Uzzah was struck dead because he dared to touch the Ark of God which was holy. The Old Covenant laws of purity indicate the need for physical purity when approaching the presence of God as is written, "None of your descendants, of whatever generation, who has any defect shall come forward to offer up the food of his God." (Lv 21:17) The animals offered in sacrifice must also be perfect or have physical integrity. All of this indicates purity of heart of any man or woman approaching the holiness of God.
The fact that God forgives our sins does not do away for the need to atone for our sins. This is well exemplified in the life of David who had relations with Uriah's wife, Bathsheba, and had Uriah killed. The prophet Samuel confronted David for his sin. David repented but had to suffer the consequences, the child which Bathshiba bore David was to die. When David heard this, he fasted and slept on the ground, but to no avail. On the seventh day the child died. (2 Sam 12) On the other hand we see that God listens to the pleading of a mediator and may take away the punishment due to sin. In the book of numbers the people had complained against God and Moses as a consequences many died from the bites of fiery serpents. Moses pleaded for the people, so God told him to set up a bronze serpent on a pole and that if those bitten looked upon it, they would be healed. So the intercession of the mediator may also take away the punishment due to sin.
Some object to the reality of Purgatory saying that Christ told the revolutionary crucified with him that that day he would be with Him in paradise. Here the following observations have been made: (1) Christ could have granted the remission of temporal punishment just to this sinner. (2) Christ could have considered the revolutionary suffering on the cross was enough suffering to purify his soul. (3) Christ did not go that day to heaven but to preach to those retained in a place which was not heaven nor hell. He could have taken the revolutionary with Him and from there to heaven. (Website <A Catholic Response/Purgatory: The Purifying Fire>)
The above is the prelude to the doctrine of Purgatory which is based on the practice of prayer for the dead and on the words of Christ who said, "... whoever speaks a word against the Son of Man will be forgiven; but whoever speaks against the holy Spirit will not be forgiven, either in this age or in the age to come." (Mt 12:32) The Church has defined this as truth of faith as follows: , "The souls of the just which, at the moment of death, are burdened with venial sins or temporal punishment due to sins, enter Purgatory." (De Fide) The condition of suffering experienced by these souls is a "purifying fire". The privation of God's vision is the primary source of great suffering. "The time of union is arrived: the soul burns in the desire of seeing God, but he cannot meet this desire, because he has not sufficiently atoned for his sins, before death." (Web page: Theology About Purgatory)
Is Purgatory also a place?
To answer this question we must consider human nature. In this life each human being is in touch with this world through sense perceptions and reason. "The complete 'I' or self is indeed this physical entity plus the world-containing and world-representing soul. The world, as it appears from one's own unique point of view, is in a real sense a part of one's identity as well,..." With death, sense perceptions cease but not each unique representation of the real world in which he or she find themselves. St. Thomas Aquinas states, "And though after death souls have no bodies assigned to them whereof they be the forms ... nevertheless certain corporeal places are appointed to them by way of congruity in reference to their degree of nobility (wherein they are as though in a place, after the manner in which incorporeal things can be in a place)" (Summa, Supplement Q. 69.1) Place is determined by spiritual presence. So it would appear that our self identity requires us to be in "place" and able intellectually to represent the world which will surround us, each in its own unique way. So the realm of existence called Purgatory is a real sphere of human presence in the universe and as such a place.
Is there physical fire in Purgatory?
This is a disputed question. The Fathers of the Western Church and some of the Greeks have maintained that the fire of Purgatory is real and not just mental. St. Thomas Aquinas saw nothing impossible in this since even the wicked spirits are detained in the fire of Hell. He wrote, "The corporeal fire is enabled as the instrument of the vengeance of Divine justice thus to detain a spirit; and thus it has a penal effect on it, by hindering it from fulfilling its own will, that is by hindering it from acting where it will and as it will. (Summa, Supplement, Q. 70.3) This fire by nature has to be different form of radiation which can burn our flesh. As an analogy, think of microwave radiation which heats food by exciting the water molecules in the food. There is no visible fire here but the food gets heated and cooked regardless. So, if physical fire is part of Purgatory, it will be of a unique kind. Physical fire, however, is not a dogma of faith.