High-resolution geochemical and sedimentological data have been obtained for a lacustrine sediment record from Lagoa Dourada (South Brazil). Four distinctly different depositional processes were determined: (1) Suspension fallout of fine-grained minerogenic particles transferred via fluvial activity dominates the Early Holocene and relates to open grassland in the catchment area; (2) Activation of the karst hydrological system with deposition of massive sand layers indicates increased precipitation at the onset of the Middle Holocene; (3) Minerogenic sediments are replaced by organic deposition due to wetter climatic conditions with the expansion of woodlands in combination with release of dissolved nutrients due to enhanced pedogenesis during the Middle to Late Holocene; (4) Human-induced land-use change caused destabilization of soils in the catchment area with resulting cultural soil erosion between AD 1800 and 1950. These depositional trends are linked to intensity variations of the South American Monsoon System (SAMS). Century-long climatic events detected by data of high-resolution XRF scanning confirm this relationship and provide signals of the 8.2 and 4.2 ka events as well as of the Little Ice Age. These events document increased rainfall with complex responses of the environmental system. Our SAMS-induced consequences of past hydroclimatic variability on the environment of South Brazil provide background information for better evaluating model projections of future climate change.