Abstract Comprehensive evaluation of aerosol-cloud interactions (ACI) simulated by climate models using observations is crucial for advancing model development. Here, we use Moderate Resolution Imaging Spectroradiometer (MODIS) data to evaluate aerosol and cloud properties obtained from Community Atmosphere Model 5 (CAM5) over northern Bay of Bengal during winter season. We conduct simulations for default model setup as well as for prescribed, and nudged meteorology using Goddard Earth Observing System (GEOS5) reanalysis dataset in order to study the impact of meteorological parameters on simulated ACI. CAM5 captures the spatial variability of cloud optical depth (τc), cloud droplet number concentration (Nc), and liquid water path (LWP), although the values are overestimated in the model. Default model strongly simulates observed negative cloud effective radius (re)-Nc susceptibility but fails to reproduce the observed positive LWP-Nc susceptibility possibly due to evaporative cooling of the large number of smaller droplets. Compared to default and prescribed meteorology simulations, nudging specific humidity (Q) at 6-hr relaxation time scale leads to a positive LWP-Nc susceptibility, and an overall improved simulation of aerosol indirect effects. Increasing the relaxation time scale beyond 6-hr degrade the simulation of indirect effects suggesting high sensitivity of indirect effects to Q and serious deficiencies in Q simulated by the model. Improvement in simulation of aerosol and cloud characteristics are also noted when winds (UV) are nudged but it worsens some of the simulated ACI sensitivities due to increased transport of absorbing aerosols over the study region and a dominant semi-direct effect in the model.