The West Spitsbergen Current (WSC) is a topographically steered boundary current that transports warm Atlantic Water northward in Fram Strait. The 16 yr (1997–2012) current and temperature–salinity measurements from moorings in the WSC at 78°50′N reveal the dynamics of mesoscale variability in the WSC and the central Fram Strait. A strong seasonality of the fluctuations and the proposed driving mechanisms is described. In winter, water is advected in the WSC that has been subjected to strong atmospheric cooling in the Nordic Seas, and as a result the stratification in the top 250 m is weak. The current is also stronger than in summer and has a greater vertical shear. This results in an e-folding growth period for baroclinic instabilities of about half a day in winter, indicating that the current has the ability to rapidly grow unstable and form eddies. In summer, the WSC is significantly less unstable with an e-folding growth period of 2 days. Observations of the eddy kinetic energy (EKE) show a peak in the boundary current in January–February when it is most unstable. Eddies are then likely advected westward, and the EKE peak is observed 1–2 months later in the central Fram Strait. Conversely, the EKE in the WSC as well as in the central Fram Strait is reduced by a factor of more than 3 in late summer. Parameterizations for the expected EKE resulting from baroclinic instability can account for the observed EKE values. Hence, mesoscale instability can generate the observed variability, and high-frequency wind forcing is not required to explain the observed EKE.