Variability of Sea-Surface Height (SSH) from ocean dynamic processes is an important component of sea-level change. In this study we dynamically downscale a present-day control simulation of a climate model to replicate sea-level variability in the Northwest European shelf seas. The simulation can reproduce many characteristics of sea-level variability exhibited in tide gauge and satellite altimeter observations. We examine the roles of lateral ocean boundary conditions and surface atmospheric forcings in determining the sea-level variability in the model interior using sensitivity experiments. Variability in the oceanic boundary conditions leads to uniform sea-level variations across the shelf. Atmospheric variability leads to spatial SSH variability with a greater mean amplitude. We separate the SSH variability into a uniform loading term (change in shelf volume with no change in distribution), and a spatial redistribution term (with no volume change). The shelf loading variance accounted for 80% of the shelf mean total variance, but this drops to ~ 60% around Scotland and in the southeast North Sea. We analyse our modelled variability to provide a useful context to coastal planners and managers. Our 200-year simulation allows the distribution of the unforced trends (over 4–21 year) of sea-level changes to be quantified. We found that the 95th percentile change over a 4-year period can lead to coastal sea-level changes of ~ 58 mm, which must be considered when using smooth sea level projections. We also found that simulated coastal SSH variations have long correlation length-scales, suggesting that observations of interannual sea-level variability from tide gauges are typically representative of > 200 km of the adjacent coast. This helps guide the use of tide gauge variability estimates.