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Temperature- and salinity-balance equations together with a one-dimensional model are used in this work to investigate the governing processes of the surface temperature and salinity variability at low and high frequencies in the southern Bay of Biscay. We found that the temporal evolution of mixed layer temperature is dominated by its seasonal cycle, mostly explained through a vertical balance (80–90%) that is mostly driven by air–sea heat exchange and contributed by entrainment, while horizontal advection plays a secondary role (≤ 12%). A substantial imbalance can be noticed in spring, which surprisingly strongly diminishes from 2003 onward, coinciding with apparent shifts in surface heat flow. The uncertainties of the air–sea heat fluxes and the advective and entrainment terms seem to be responsible for the imbalance of the temperature budget. On the contrary, the interannual variability dominates over the seasonal cycle of mixed layer salinity, and advection accounts for more than 70% of the budget terms, with the sum of vertical processes playing a secondary role. The different contributions of air–sea exchanges on temperature and salinity (heat vs. freshwater) are the ultimate cause of the different patterns observed for both of the parameters.