Climate models consistently project a decrease of winter rainfall over South Africa’s Southwestern Cape (SWC) in the coming decades, but the magnitude of future drying is highly uncertain. Here we show that SWC winter rainfall variability and long-term changes are primarily controlled by large-scale zonal and meridional circulation. Using circulation-based driver indices tailored to the region of interest, we reconstruct observed SWC precipitation variability, capturing approximately 40 % of its interannual variability. Applied to CMIP6 simulations, around 75 % of the projected end-of-century precipitation decline is attributable to these dynamical relationships, and a large fraction (around 35 %) of the inter-model spread can be traced back to differing driver responses to global warming across models. We further show that models struggle to realistically represent the mean-state of the identified dynamical drivers as well as their links to rainfall changes which undermines confidence in their simulated rainfall projections. Lastly, we show that observation-informed rainfall projections indicate stronger end-of-century drying than the CMIP6 multi-model median, suggesting that future winter rainfall declines in the SWC may be underestimated by model projections.