Understanding past environmental and climate changes is essential for understanding their influence on human history and for predicting future trends. The Valley of Gobi Lake in Mongolia is highly sensitive to climate changes. We analyzed two sediment cores from Boontsagaan Lake, the largest in the Valley of Gobi Lakes and only permanent lake: a 111 cm core (East-20240226) close to the inflow river mouth and a 141 cm core (North20240227) located 8 km away from the river mouth. Grain size differences between the cores indicate coarser material deposition near the river mouth (East-20240226) due to the density underflow, whereas the distant core (North-20240227) shows finer fluvial and aeolian inputs. The radiocarbon and optically stimulated luminescence dating methods applied to the North-20240227 core. Sandy layers below the lacustrine sediment sequence probably indicate dramatic lake level lowering between similar to 300 CE and 1200 CE, corresponding dry phase in the region. A subsequent recovery of lake conditions, linked to the increased river inflow by the topographic shifts, marks a wetter phase after similar to 1200 CE and coinciding with the expansion of the Mongolian empire. After similar to 1400 CE, enhanced carbonate precipitation suggests another dry period, which potentially coincided with the decline of Mongolian empire. The high sediment rate and coarsening grain size in the North-20240227 core show intensified aeolian input due to continued lake shrinkage after similar to 1850 CE. The sediment record from this permanent lake captures key environmental transitions over the last two millennia, regional climate changes and sociopolitical developments in Mongolian territory, including the rise and decline of the Mongolian Empire.