Abstract The primary goal of this paper is to diagnose, the “direct” and “indirect” effects of latent heat release on a synoptic-scale wave system containing an extratropical cyclone that developed over the eastern United States. To achieve this goal, comparisons are made between MOIST (full model physics) and DRY (latent heating removed) predictions of the wave system during the period 27–29 February 1984 using the National Meteorological Center's Limited-Area Fine Mesh (LFM) model. Both the MOIST and DRY models predict significant cyclone systems, suggesting that the background adiabatic forcing is quite important. However, the DRY model predict a weaker cyclone. The direct and indirect latent heating influences are diagnosed using eddy energy quantities and the extended height tendency equation. Direct effects are restricted to the diabatic generation of available potential energy and height tendencies forced by diabatic heating. Results show that latent heating exerts an important direct influence on ...