The NASA Seasonal-to-Interannual Prediction Project coupled-model system, which consists of a multi-level global atmospheric general circulation model coupled to a 3-D, numerical ocean model with a reduced-gravity formulation, and a land-surface process model, is used to examine climate variability over the Indian Ocean sector, and prospects for forecasting this variability with lead times of a season or more. The recently identified Indian Dipole Mode, which is associated with severe droughts over Indonesia and flooding over east Africa, is the focus of the investigation, as it is known to have a well-defined sea-surface temperature signature with subsurface oceanic processes involved in its evolution and decay.