The fall into the Oligocene icehouse is marked by a steady decline in global temperature with punctuated cooling at the Eocene-Oligocene transition, both of which are well documented in the marine realm. However, the chronology and mechanisms of cooling on land remain unclear. Here, we use clumped isotope thermometry on northeastern Tibetan continental carbonates to reconstruct a detailed Paleogene surface temperature record for the Asian continental interior, and correlate this to an enhanced pollen data set. Our results show two successive dramatic (>9 °C) temperature drops, at 37 Ma and at 33.5 Ma. These large-magnitude decreases in continental temperatures can only be explained by a combination of both regional cooling and shifts of the rainy season to cooler months, which we interpret to reflect a decline of monsoonal intensity. Our results suggest that the response of Asian surface temperatures and monsoonal rainfall to the steady decline of atmospheric CO2 and global temperature through the late Eocene was nonlinear and occurred in two steps separated by a period of climatic instability. Our results support the onset of the Antarctic Circumpolar Current coeval to the Oligocene isotope event 1 (Oi-1) glaciation at 33.5 Ma, reshaping the distribution of surface heat worldwide; however, the origin of the 37 Ma cooling event remains less clear.