We evaluated the effect of climate on inter-annual variability in the terrestrial Net Ecosystem Exchange (NEE) of CO₂ using the Simple Biosphere Model, Version 2 (SiB2) for 1983 to 1993 on a global, 1° by 1° latitude/longitude grid with a 10-minute time step. We used the process information in SiB2 to quantify climate influences on NEE, to explain regional differences, and to relate NEE variability to the Arctic Oscillation (AO) and the El Niņo-Southern Oscillation (ENSO). The simulated NEE reproduces the salient features and magnitude of the measured global CO₂ growth rate. Due to cancellation and competing effects, no single climate variable controls global NEE inter-annual variability. Precipitation accounts for 29%; followed by temperature, soil carbon, and Leaf Area Index at roughly 21% each. Temperature control of respiration dominates NEE inter-annual variability at mid- and high latitudes. Precipitation control of Gross Primary Production and respiration dominates in the tropics. The influence of ENSO on NEE variability is consistent with that expected for shifting precipitation patterns in the tropics. Except in northern Europe, temperature advection by the AO does not significantly influence NEE variability.