New proxy records from deep‐sea sediment cores from the northwestern continental margin of Western Australian reveal a 5.3 million‐year (Ma) history of aridity and tropical‐monsoon activity in northwestern Australia. Following the warm and dry early Pliocene (~5.3 Ma), the northwestern Australian continent experienced a gradual increase in humidity peaking at about 3.8 Ma with higher than present‐day rainfall. Between 3.8 and about 2.8 Ma, climate became progressively more arid with more rainfall variability. Coinciding with the onset of the northern hemisphere glaciations and the intensification of the northern hemisphere monsoon, aridity continued to increase overall from 2.8 Ma until today, with greater variance in precipitation and an increased frequency of large rainfall events. We associate the observed large‐scale fluctuations in Australian aridity with variations in Indian Ocean sea‐surface temperatures (SST), which largely control the monsoonal precipitation in northwestern Australia.