AbstractOver the satellite record, the Barents Sea winter maximum in sea ice extent has declined and was increasingly limited to areas north of the Polar Front after 2005 by warming Atlantic Water (AW) and Barents Sea Water (BSW). Sea ice extent here continues to garner interest, not least because it is associated with extreme winter weather in Europe and Asia. Previous model studies suggest there is a possibility that natural variability will cause southward re‐expansion of the lost sea ice cover but reducing uncertainties requires a better understanding of the processes driving BSW variability. To address questions about BSW variability, we used a high‐resolution model validated with observations over 1985–2014 to calculate the watermass transport, heat, and freshwater budgets within the central Barents Sea, south of the Polar Front. The model shows BSW volume minima events in years centering at 1990 and 2004, meaning a reduction in the Barents Sea's volume reservoir (also termed “memory”) of water that is consistent with historical BSW properties. Both events were preceded by extensive winter sea ice and substantial summer net sea ice melt. The event in 2004 was more extreme and led to warming AW occupying a greater volume in the Barents Sea after 2005. The reduced “memory” of BSW volume could impede a return to the more extensive winter sea ice regime and make further reduction in winter sea ice possible.