Global climate variability during the late Quaternary is commonly investigated within the framework of the ‘bipolar seesaw’ pattern of asynchronous temperature variations in the northern and southern polar latitudes. The terrestrial hydrological response to this pattern in south-eastern Australia is not fully understood, as continuous, high-resolution, well-dated proxy records for the hydrological cycle in the region are sparse. Here we present a well-dated, highly resolved record of moisture balance spanning 30000–10000 calendar years before present (30–10 ka BP), based on x-ray fluorescence and organic carbon isotope (δ13COM) measurements of a sedimentary sequence from Lake Surprise in south-eastern Australia. The data provide a locally coherent record of the hydrological cycle. Elevated Si (reflecting windblown quartz and clays), and relatively high δ13COM, indicate an extended period of relative aridity between 28 and 18.5 ka BP, interrupted by millennial-scale episodes of decreased Si and δ13COM, suggesting increased moisture balance. This was followed by a rapid deglacial shift to low Si and δ13COM at 18.5 ka BP, indicative of wetter conditions. We find that these changes are coeval with other records from south-eastern Australia and New Zealand, and use a Monte Carlo Empirical Orthogonal Function approach to extract a common trend from three high-resolution records. Our analyses suggest that drivers of the regional hydrological cycle have varied on multi-millennial time scales, in response to major shifts in global atmosphere-ocean dynamics during the last glacial-interglacial transition. Southern Ocean processes were the dominant control on hydroclimate during glacial times, via a strong influence of cold sea surface temperatures on moisture uptake and delivery onshore. Following the last deglaciation (around 18 ka BP), the southward migration of cold Southern Ocean fronts likely resulted in the establishment of conditions more like those of the present day. Millennial-scale variability in records from the region is dominated by a persistent ca. 2300-year periodicity, consistent with other records across the Southern Hemisphere mid-latitudes; however, this pervasive periodicity is not obviously linked to the ‘bipolar seesaw’ and the mechanism remains equivocal.