During the late Miocene, global cooling occurred alongside the establishment of near-modern terrestrial and marine ecosystems. Significant (3 to 5 °C) sea surface cooling from 7.5 to 5.5 Ma is recorded by proxies at mid to high latitudes, yet the magnitude of tropical cooling and the role of atmospheric carbon dioxide (pCO2) in driving this trend are debated. Here, we present a new orbital-resolution sea surface temperature (SST) record spanning the late Miocene to earliest Pliocene (9 to 5 Ma) from the eastern equatorial Indian Ocean (International Ocean Discovery Program Site U1443) based on Mg/Ca ratios measured in tests of the planktic foraminifer Trilobatus trilobus. Our SST record reveals a 3.2 °C decrease from 7.4 to 5.8 Ma, significantly increasing previous estimates of late Miocene tropical cooling. Analysis of orbital-scale variability shows that before the onset of cooling, SST variations were dominated by precession-band (19-23 kyr) variability, whereas tropical temperature became highly sensitive to obliquity (41 kyr) after 7.5 Ma, suggesting an increase in high latitude forcing. We compare a revised global SST database with new paleoclimate model simulations and show that a pCO2 decrease from 560 ppm to 300 ppm, in the range suggested by pCO2 proxy records, could explain most of the late Miocene sea surface cooling observed at Site U1443. Estimation of meridional sea surface temperature gradients using our new Site U1443 record as representative of tropical SST evolution reveals a much more modest increase over the late Miocene than previously suggested, in agreement with modelled gradients.