Water from the western Pacific flows through the Indonesian Seas following different pathways and is modified by various processes to form the uniquely characterized isohaline Banda Sea Water. The processes contributing to the isohaline structure are studied using data from three ARLINDO cruises in 1993, 1994, and 1996. An inverse-model analysis using salinity and CFC-11 data is applied to a vertical section along the main path of flow, from the Makassar Strait to the Flores Sea and Banda Sea. The model reproduces the seasonal and interannual variability of the throughflow and shows reversals of flow in the vertical structure. The model solutions suggest strong baroclinic flows during the southeast monsoon of 1993 and 1996 and a small, more barotropic flow during the northwest monsoon of 1994. The isohaline structure can be accounted for by isopycnal mixing of different source waters and by vertical exchanges, which are significant in this region. A downward flux equivalent to a downwelling velocity of 5 × 10-7 m/s is estimated for the section. The total balance also suggests that seasonally and possibly interannually variable backflushing of water from the Banda Sea into the Straits contribute to the isohaline structure of Banda Sea water.