AbstractRainfall variability over Australia is revisited from the viewpoint of the atmospheric moisture budgets in three regions: the extratropics, Subtropics, and Tropics. The budgets are calculated using three‐hourly European Centre for Medium‐Range Weather Forecasts Reanalysis v5 (ERA5) and ERA5‐Land data between 1979 and 2022. The use of the moisture budget at short time‐scales enables the investigation of the relationship between synoptic weather‐scale processes and the longer term variability of the rainfall climate. The total variability in the vertically integrated moisture flux divergence (VIMD) is significantly larger than the evaporation minus precipitation (E − P), to a large extent due to the sub‐daily time‐scales. E − P is related more closely to moisture flux convergence in winter (summer) over south (north) Australia, suggesting a clear seasonality in the relationship between the two budget terms. The E − P–VIMD relationship is nearly in phase in the Tropics, whereas VIMD leads E − P by 9–15 hr with eastward‐propagating signals in the extratropics and Subtropics. Such seasonal and regional discrepancies in the relationship are attributed to the background state of moisture availability and temperature as represented by relative humidity and lifting condensation levels. The variability of the budget imbalance and its seasonality are dominated by the variability in VIMD. The imbalance reduces rapidly with temporal smoothing, with the storage term approaching zero at approximately 20 days, which can be thought of as making a transition time‐scale from high‐frequency weather‐related variability into slow‐varying background conditions. Weather‐related variability (cyclones, fronts, and thunderstorms) dominates the overall E − P variability in the extratropics and Subtropics, whereas slow‐varying background conditions contribute equally to the total variability in the Tropics.