Modelling continental freshwater dynamics is expected to be challenging in regions with considerable influence of multi-scale global climatic drivers. An assessment of the interplay between these climatic drivers (e.g. El-Niño Southern Oscillation-ENSO) that influence hydro-climatic conditions and hydrological processes is therefore required to optimize predictive frameworks. The main aim of this study is to assess the impacts of eleven key climate modes describing oceanic variability in the nearby oceans on the spatial and temporal distributions of terrestrial water storage (TWS) derived from Gravity Recovery and Climate Experiment (GRACE) (2002 − 2017) over South America (SA). Considering that SA accounts for nearly one-fifth of global continental freshwater discharge, this assessment is crucial because of the differences in the intrinsic response of freshwater availability in some regions to several important processes of inter-annual variability. The novel integration of independent component analysis with parameter estimation techniques in this study shows that climate variability drivers (ENSO; Southern Oscillation Index (SOI); Pacific Decadal Oscillation (PDO); Ninos 1 + 2, 3.0, 3.4 and 4.0; North Tropical Atlantic (NTA); and the Caribbean Sea Surface Temperature (SST) anomalies) have considerable association (α = 0.05) with GRACE-derived TWS over SA. The influence of Nino 4.0 (r = − 0.72), Nino 3.4 (− 0.68), Nino 3.0 (− 0.53), ENSO (r = − 0.71), PDO (r = − 0.69), SOI (r = 0.64), Caribbean SST (r = − 0.67) and NTA (r = − 0.51) on TWS are relatively stronger in tropical SA (Amazon basin/northern SA) and result in higher amplitudes of TWS (> 100 mm). Given the temporal and spatial relationships of TWS with PDO over SA, there is also evidence to suggest strong multi-decadal variability in TWS.