The palynological investigation of core TM (27.7 m long) taken in a dried out lagoon reveals both Holocene vegetation history in the north-eastern foothills of the Alborz Mountains and past water level changes of the Caspian Sea (CS). The delay in woodland expansion at the beginning of the Holocene, which is typical of eastern Turkey, the Iranian plateau and recorded in the CS south basin, is only weakly felt as the region is close to glacial refugia of trees. The succession of the main trees out of their refugia has been established as deciduous Quercus, Carpinus betulus, Parrotia persica, and Fagus orientalis-Pterocarya fraxinifolia, presenting therefore close affinities to south European interglacials of the Early Pleistocene. This suggests a similarity in climate. A Pterocarya decline is observed after AD 495. The studied region is close to the easternmost tree distribution; this could explain why it has been affected earlier than elsewhere in the northern Alborz and the Caucasus. In addition human activities during the Sasanian Empire and the subsequent drying of the climate contributed to weakening the spread of this tree. A maximal sea level occurs in the first part of the Holocene from 10.6 to 7.2 cal. ka. It is suggested that the CS levels were significantly influenced by the monsoon precipitations over the western Himalayas (via the Uzboy inflow). This is followed by low levels from 7.2 to 3.5 cal. ka with a minimum at 3.9 cal. ka. The Neocaspian period should be considered a biozone rather than a chronozone, as the environmental conditions reconstructed from dinocyst assemblages are different in shallow shelf waters and in the deep basins.