A 12 m thick section in a dune-sandy plain terrain of the Central Thar in Rajasthan, has provided a near continuous record of environmental change for the past 160 ka. The site presently receives 280 mm rainfall, almost entirely from the summer monsoon. The base of this section comprises a gravel bed of an ephemeral stream and the overlying six litho-units, each with discrete boundaries, comprise a succession of aeolian sands. Luminescence dating provided an estimate of the timing of the sand aggradation periods to 160, 90, 60, 27 and 17–14 ka and helped constrain the timing of calcrete formation periods. In each aggradation unit, discrete nodular calcretes formed by the leaching of carbonate from the overlying solum. This is analogous to present-day conditions in sandy plains during periods of increased rainfall and landscape stability. Several of these calcretes are, however, devoid of their donor solum, suggesting solum removal during a subsequent period of decreased rainfall and resultant surface instability. This is supported by the presence of reworked nodules on the surfaces of some calcretes. A prominent phase of calcrete development followed the aeolian sand aggradation at 60 ka, suggesting climate amelioration that also caused the formation of groundwater-related calcrete and mottling. The study suggests that stage II calcrete nodules form in a time frame of 10–20 ka, and confirms limited data on the duration and stage of calcrete development in the literature. The d13C values of calcrete carbonate lie in a narrow range (+0.5 to -1.1‰) suggesting formation under soils with C4 vegetation. This implies that even during phases of climatic amelioration, the high temperatures and increased seasonality of rainfall did not permit significant development of C3 plants in the Central Thar.