Abstract The impact of South American orography on subtropical stratocumulus clouds off the Peruvian coast is investigated in the context of an atmospheric general circulation model. It is found that stratocumulus incidence is significantly reduced when South American orography is removed. Key to this behavior is a decrease in lower tropospheric stability (LTS) that allows for more frequent stratocumulus destruction through the model’s cloud-top entrainment instability mechanism. The role of orography in enhancing Peruvian stratocumulus is as follows. Within the PBL, orography deflects the midlatitude westerly winds equatorward in association with cold air advection and blocking of the low-level flow from the continent. Above the PBL, the steep and high South American orography deflects a significant portion of the midlatitude westerlies equatorward. This flow sinks along the equatorward sloping isentropes, thus promoting subsidence. Both processes increase LTS over the stratocumulus region. In further AGCM experiments, the sensitivity of Peruvian stratocumulus to the use of unsmoothed orographic boundary conditions is assessed. The results show no significant differences to the control simulation, which uses smoothed orography. This suggests that, in the context of GCMs, a representation of South American orography more detailed than is generally used has little potential for improving the performance of coupled ocean–atmosphere models in the eastern tropical Pacific.