Heat and salt storage variability in the upper 1000 m of the Indian Ocean is investigated using a combination of sea level anomalies derived from TOPEX/Poseidon altimetry (1993--2000), Reynold's sea surface temperature and monthly climatological hydrographic data (World Ocean Atlas 1998) <Antonov et al., 1998; Boyer et al., 1998>. This new technique allows extension of surface information from altimetric observations to study subsurface variability. Hydrographic data collected in the Indian Ocean during the World Ocean Circulation Experiment are used to evaluate and validate this technique. The results show that the Indian Ocean experienced larger changes in heat storage than in salt storage. Significant differences are found between the 8-year mean seasonal heat storage and the climatological seasonal heat storage, which are attributed to interannual variability, while the 8-year mean seasonal salt storage agrees well with the climatological seasonal salt storage. The variabilities of heat and salt storages are not synchronized in either space or time because of different control mechanisms. The first four empirical orthogonal function (EOF) modes explain nearly 60% of total variance of heat storage variability with the Indian Ocean dipole outweighing the other processes. The dominant first EOF mode for salt storage, which is attributed to the seasonal variability, explains 33% of its total variance. The heat (salt) storage dipole index, representing the heat (salt) storage difference between the west and east equatorial Indian Ocean during the 1994--1995 and 1997--1998 dipole periods, is of the same order as that of the seasonal heat (salt) storage variability.