Understanding climate variability and stability under extremely warm ‘greenhouse’ conditions in the past is essential for future climate predictions. However, information on millennial-scale (and shorter) climate variability during such periods is scarce, owing to a lack of suitable high-resolution, deep-time archives. Here we present a continuous record of decadal- to orbital-scale continental climate variability from annually laminated lacustrine deposits formed during the late Early Cretaceous (123–120 Ma: late Barremian–early Aptian) in southeastern Mongolia. Inter-annual changes in lake algal productivity for a 1091-year interval reveal a pronounced solar influence on decadal- to centennial-scale climatic variations (including the ~ 11-year Schwabe cycle). Decadally-resolved Ca/Ti ratios (proxy for evaporation/precipitation changes) for a ~ 355-kyr long interval further indicate millennial-scale (~ 1000–2000-yr) extreme drought events in inner-continental areas of mid-latitude palaeo-Asia during the Cretaceous. Millennial-scale oscillations in Ca/Ti ratio show distinct amplitude modulation (AM) induced by the precession, obliquity and short eccentricity cycles. Similar millennial-scale AM by Milankovitch cycle band was also previously observed in the abrupt climatic oscillations (known as Dansgaard–Oeschger events) in the ‘intermediate glacial’ state of the late Pleistocene, and in their potential analogues in the Jurassic ‘greenhouse’. Our findings indicate that external solar activity forcing was effective on decadal–centennial timescales, whilst the millennial-scale variations were likely amplified by internal process such as changes in deep-water formation strength, even during the Cretaceous ‘greenhouse’ period.