Surface drifters released in the central Red Sea during April 2010 detected a well-defined anticyclonic eddy around 23°N. This eddy was ∼45–60 km in radius, with a swirl speed up to ∼0.5 m/s. The eddy feature was also evident in monthly averaged sea surface height fields and in current profiles measured on a cross-isobath, shipboard CTD/ADCP survey around that region. The unstructured-grid, Finite-Volume Community Ocean Model (FVCOM) was configured for the Red Sea and process studies were conducted to establish the conditions necessary for the eddy to form and to establish its robustness. The model was capable of reproducing the observed anticyclonic eddy with the same location and size. Diagnosis of model results suggests that the eddy can be formed in a Red Sea that is subject to seasonally varying buoyancy forcing, with no wind, but that its location and structure are significantly altered by wind forcing, initial distribution of water stratification and southward coastal flow from the upstream area. Momentum analysis indicates that the flow field of the eddy was in geostrophic balance, with the baroclinic pressure gradient forcing about the same order of magnitude as the surface pressure gradient forcing.