We present a pollen‐based precipitation reconstruction and multi‐proxy records from a 485‐cm‐long sequence from a sediment core from Xingyun Lake, Yunnan Plateau, south‐west China, which depicts the evolution of the Indian Summer Monsoon (ISM) during the last 8500 years. Pollen and other palaeoenvironmental records document several stages of vegetation history and climate change. The warmest and wettest climate in the Xingyun Lake catchment occurred before 5500 cal a BP, and subsequently the climate became gradually drier. After 2000 cal a BP the regional environmental conditions became unstable, and a wet Medieval Warm Period is probably recorded. Our reconstruction of the ISM is similar to that portrayed by Holocene speleothem δ18O records from southern China, but is distinctly different from the East Asian Summer Monsoon (EASM) evolution, which features a mid‐Holocene maximum. Our results support the hypothesis that the ISM and EASM evolved asynchronously during the Holocene, and imply that the Chinese speleothem δ18O records from southern China may principally reflect changes in moisture source from the Indian monsoon domain, and thus record the history of the ISM rather than the EASM.