Results from a 120-year simulation of the Mediterranean sea with a 1/4¿, 19-level eddy-permitting Cox model with monthly varying wind and buoyancy forcing are presented. Mean and seasonal currents are examined along with water distributions on isopycnals. Detailed equilibrated thermohaline water pathways, broadly consistent with observed hydrographic data, are determined. The most important factor permitting a long model run is low vertical mixing, which maintains Levantine intermediate water (LIW) above the level of the Sicily sill so that it can reach the western basin. A new feature is Tyrrhenian deep water, which is formed after 40 years by deep water transfer from the Balearic basin south of Sardinia. A water mass analysis reveals the modification of water properties in T, S space through the mixing processes that take place at straits and through the action of mesoscale eddies. The surface heat and freshwater fluxes derived a posteriori are in very good agreement with observations, showing that basin average fluxes are closely tied to the generation of a realistic thermohaline circulation. A complete analysis of surface and strait fluxes demonstrates that equilibrium conditions have been reached. A study of the heat budget in the intermediate water layer at 280 m depth reveals that the dominant diabatic terms are at localized convection sites, suggesting that at this depth the thermocline is under advective rather than diffusive control. The eddy and mean flow heat transports balance to a large degree away from these sites, with a negligible role for diffusion. ¿ 1998 American Geophysical Union