Abstract. A brief (~150 kyr) period of widespread global average surface warming marks the transition between the Paleocene and Eocene epochs, ~56 million years ago. This so-called "Paleocene-Eocene thermal maximum" (PETM) is associated with the massive injection of ¹³C-depleted carbon, reflected in a negative carbon isotope excursion (CIE). Biotic responses include a global abundance peak (acme) of the subtropical dinoflagellate Apectodinium. Here we identify the PETM in a marine sedimentary sequence deposited on the East Tasman Plateau at Ocean Drilling Program (ODP) Site 1172 and show, based on the organic paleothermometer TEX₈₆, that southwest Pacific sea surface temperatures increased from ~26 °C to ~33°C during the PETM. Such temperatures before, during and after the PETM are >10 °C warmer than predicted by paleoclimate model simulations for this latitude. In part, this discrepancy may be explained by potential seasonal biases in the TEX₈₆ proxy in polar oceans. Additionally, the data suggest that not only Arctic, but also Antarctic temperatures may be underestimated in simulations of ancient greenhouse climates by current generation fully coupled climate models. An early influx of abundant Apectodinium confirms that environmental change preceded the CIE on a global scale. Organic dinoflagellate cyst assemblages suggest a local decrease in the amount of river run off reaching the core site during the PETM, possibly in concert with eustatic rise. Moreover, the assemblages suggest changes in seasonality of the regional hydrological system and storm activity. Finally, significant variation in dinoflagellate cyst assemblages during the PETM indicates that southwest Pacific climates varied significantly over time scales of 10³ – 10⁴ years during this event, a finding comparable to similar studies of PETM successions from the New Jersey Shelf.