Abstract. In several papers, the solar cycle (SC) effect in the lower atmosphere has been linked observationally to the Quasi-biennial Oscillation (QBO) of the zonal circulation. Salby and Callaghan (2000) in particular analyzed the QBO wind measurements, covering more than 40 years, and discovered that they contain a large SC signature at 20 km. We present here the results from a study with our 3-D Numerical Spectral Model (NSM), which relies primarily on parameterized gravity waves (GW) to describe the QBO. In our model, the period of the SC is taken to be 10 years, and the relative amplitude of radiative forcing varies exponentially with height, i.e., 0.2% at the surface, 2% at 50 km, and 20% at 100 km and above. Applying spectral analysis to identify the SC signature, the model generates a relatively large modulation of the QBO, which reproduces the observations qualitatively. The numerical results demonstrate that the QBO modulation, closely tracking the phase of the SC, is robust and persists at least for 70 years. The question is what causes the SC effect, and our analysis shows that four interlocking processes are involved: (1) In the mesosphere at around 60 km, the solar UV variations generate in the zonal winds a SC modulation of the 12-month annual oscillation, which is hemispherically symmetric and confined to equatorial latitudes like the QBO. (2) Although the amplitude of this equatorial annual oscillation (EAO) is relatively small, its SC modulation is large and extends into the lower stratosphere under the influence of, and amplified by, wave forcing. (3) The amplitude modulations of both EAO and QBO are essentially in phase with the imposed SC heating for the entire time span of the model simulation. This indicates that, due to positive feedback in the wave mechanism, the EAO apparently provides the pathway and pacemaker for the SC modulation of the QBO. (4) Our analysis demonstrates that the SC modulations of the QBO and EAO are amplified by tapping the momentum from the upward propagating gravity waves. Influenced and amplified by wave processes, the QBO thus acts as conduit to transfer to lower altitudes the larger SC variations in the UV absorbed in the mesosphere. Our model produces in the temperature variations of the QBO and EAO measurable SC modulations at polar latitudes near the tropopause. The effects are apparently generated by the meridional circulation, and planetary waves presumably, which redistribute the energy from the equatorial region where the waves are very effective in amplifying the SC influence.