A box inverse model for the southeastern Pacific is used to combine hydrographic measurements with synoptic information from floats, acoustic Doppler surface velocity measurements, altimeter-derived surface geostrophic velocities, and wind measurements. The southeastern Pacific is marked by substantial changes in eddy kinetic energy along the path of the Antarctic Circumpolar Current (ACC), associated with the Eltanin and Udintsev Fracture Zones in the East Pacific Rise. The results of the inverse model show that the heat and salt carried by the ACC are essentially unchanged as the current passes through regions of high eddy variability. Thus, within the error bars of the available measurements the ACC appears not to exchange significant water properties with its surroundings in the southeastern Pacific Ocean. (The system is geographically variable, and elsewhere in the Southern Ocean, meridional exchanges may be substantial.) Meridional flow through the north side of the inverse model domain is consistent with an overturning circulation that carries surface intermediate water northward and returns deep water southward into the ACC. Diapycnal fluxes identified in the inverse solution indicate that water mass transformation occurs predominantly in the outcropping upper layers of the ocean. ¿ 1999 American Geophysical Union