The moisture budget over the Atlantic Ocean and South America is evaluated for two contrasting 5-year periods, 1985-1989 (wet) and 1990-1994 (dry), of rainfall over Northeast Brazil (NEB) using NCEP/NCAR reanalysis data. The linear correlation coefficients between the 5-year averages of rainfall over NEB and sea surface temperature (SST) anomalies over the Atlantic Ocean show a dipole configuration over the Tropical Atlantic. It is found that evaporation is higher over the Tropical North Atlantic, and lower over the Tropical South Atlantic during the 5-year period of higher rainfall over NEB. Higher evaporation causes lower SST and vice versa. This seems to be the main mechanism which generates dipole configuration in the Atlantic SST. During the rainy season (February through May) in NEB moisture is transported towards NEB and converges, providing the necessary moisture source for the rainfall. This low level convergence is associated with the rising branch of a local meridional circulation cell, which in turn is generated by the SST dipole. This series of interlinked mechanisms seems to fit in a physical picture responsible for the rainfall decadal variation over NEB.