Abstract The physical processes associated with the ∼70-yr period climate mode, known as the Atlantic multidecadal oscillation (AMO), are examined. Based on analyses of observational data, a deterministic mechanism relying on atmosphere–ocean–sea ice interactions is proposed for the AMO. Variations in the thermohaline circulation are reflected as uniform sea surface temperature anomalies in the North Atlantic. These anomalies are associated with a hemispheric wavenumber-1 sea level pressure (SLP) structure in the atmosphere that is amplified through atmosphere–ocean interactions in the North Pacific. The SLP pattern and its associated wind field affect the sea ice export through Fram Strait, the freshwater balance in the northern North Atlantic, and consequently the strength of the large-scale ocean circulation. It generates sea surface temperature anomalies with opposite signs in the North Atlantic and completes a negative feedback. The authors find that the time scale of the cycle is associated with the thermohaline circulation adjustment to freshwater forcing, the SST response to it, the oceanic adjustment in the North Pacific, and the sea ice response to the wind forcing. Finally, it is argued that the Great Salinity Anomaly in the late 1960s and 1970s is part of AMO.