Subtropical Mode Water (STMW), characterized by vertically uniform temperature of ~17°C, is distributed horizontally over 5000 kilometers at the 100- to 500-meter depths in the subtropical North Pacific Ocean. Its formation and spreading fluctuate in relation to the Pacific Decadal Oscillation and the Kuroshio path variation, but the feedback from STMW on the sea surface temperature (SST) and the overlying atmosphere remains unclear. Using Argo profiling float data, we show that STMW south of Japan, whose thickness varies decadally, modulates the overlying thermal structure throughout the year by increasing isotherm uplift with increasing thickness. The STMW-induced decadal temperature change has a magnitude of up to ~1°C and is large in the warm season in the presence of the seasonal thermocline. Furthermore, 50-year observations, together with numerical simulation, show that SST, upper ocean heat content, and typhoon intensification rate have been significantly lower in years with thicker STMW and higher in years with thinner STMW.