BaTiO3 (BTO) is a prototypical perovskite ferroelectric, whose dielectric permittivity and loss spectra – which are strongly temperature and frequency dependent – include contributions from inhomogeneous polarization patterns, with domain walls (DWs) being the most common types. In order to elucidate how DWs influence dielectric response, we utilized a continuum approach based on the Landau–Ginzburg theory to model field-dependent properties of polydomain tetragonal phase of BTO near room temperature and above. A system with 180∘ DWs was evaluated as a case study, with both position-resolved and volume-averaged dielectric susceptibility and loss computed at different temperatures for a range of applied field frequencies and amplitudes. Our results demonstrate that cooperative dipole fluctuations in the vicinity of the DW provide a large (extrinsic) contribution to the system dielectric response relative to the intrinsic contribution stemming from within the domain. Dynamics of the DW profile fluctuations under applied field can be represented by a combination of breathing and sliding vibrational motions, with each exhibiting distinct dependence on the field frequency and amplitude. The implications of this behavior are important for understanding and improving control of coupled functional properties in ferroelectric materials, including their dielectric, electromechanical, and electrooptical responses. Furthermore, this investigation provides a computational benchmark for future studies and can be readily extended to other topological polarization patterns in ferroelectrics.