Abstract This study describes the development of the South China Sea (SCS) daily satellite-derived latent heat flux (SCSSLH) for the period of 1998–2011 at 0.25° × 0.25° resolution using data mainly from the Tropical Rain Measuring Mission (TRMM) Microwave Imager (TMI). Flux-related variables of daily TMI data smoothed with 3-day running mean were finally chosen because of the best fit with the 1727 high-quality observations from seven moored stations and 24 ship surveys. Near-surface air specific humidity was computed using the global relationship based on satellite precipitable water. Verification against 1016 high-resolution radiosonde profiles from 1998 to 2012 and the time series from the Xisha automatic weather station during 2008–10 indicate that this satellite-derived air specific humidity can reasonably capture observed mean condition and temporal variability. They are therefore used to derive SCSSLH based on the Coupled Ocean–Atmosphere Response Experiment version 3.0 (COARE 3.0) algorithm. Compared with five other latent heat flux products—the Goddard Satellite-Based Surface Turbulent Fluxes version 2 (GSSTF2), the objectively analyzed air–sea heat fluxes (OAFlux), the Hamburg Ocean Atmosphere Parameters and Fluxes from Satellite Data version 3 (HOAPS3), the National Centers for Environmental Prediction/Department of Energy Global Reanalysis 2 (NCEP-2), and the European Centre for Medium-Range Weather Forecasts (ECMWF)—the daily SCSSLH shows the highest spatial resolution and realistic values in the SCS, with an exception along the northern continental shelf. More importantly, the other five products seem to overestimate the latent heat flux systematically. The flux representation in this study comes not only with a better flux algorithm but also with the improved estimates of bulk variables based on in situ measurements, which further highlights the unique role of high-quality meteorological measurements and atmospheric weather stations in evaluating the air–sea interaction in the SCS.