This study examines the interannual variability of the tropical cyclone (TC) activity in the Southern Hemisphere (SH) during the period 1970-2008. An empirical orthogonal function analysis of the annual frequency of TC occurrence shows three leading modes of TC occurrence patterns. The first mode, which is related to the El Niño-Southern Oscillation (ENSO) phenomenon, shows an east-west oscillation between the anomalous TC activity over the South Pacific and the southern Indian Ocean. The second mode, characterised by an east-west dipole of anomalous TC activity over the southern Indian Ocean, is apparently related to both ENSO and the Indian Ocean dipole (IOD). The third is a basin-wide mode that represents the overall TC activity in the SH.Within the SH, TC activity in the Australian region is found to be related to ENSO and IOD, with the relation being more prominent for the western Australian region. Basing on the ENSO-and IOD-related predictors such as Niño-4 SST anomaly, trade wind index, outgoing longwave radiation index and dipole-mode index, a statistical prediction scheme for the annual number of TCs in the entire Australian region (40°S-0°N, 90°E-160°E), the western Australian region (40°S-0°N, 90°E-135°E) and the eastern Australian region (40°S-0°N, 135°E-160°E) by 1 November is proposed. This scheme gives a 51, 39 and 37% skill improvement in root-mean-square error relative to climatology for the three regions respectively.