The Bosphorus exchange is of critical importance for hydrodynamics and hydroclimatology of the Black Sea. In this study, we report on the development of a medium-resolution circulation model of the Black Sea, making use of surface atmospheric forcing with high space and time resolution, climatic river fluxes and strait exchange, enabled by adding elementary details of strait and coastal topography and seasonal hydrology specified in an artificial box on the Marmara Sea side. Particular attention is given to circulation, mixing and convective water mass formation processes in the model, which are then compared with observations. Open boundary conditions relaxed to seasonal hydrology specified in the artificial box are found to enable Bosphorus exchange with a proper upper layer, lower layer and net fluxes comparable to the observed ranges. These improvements at the artificial boundary and in the interior evolution of the Black Sea allow the study to capture daily, seasonal to decadal climatic variability and change observed in the Black Sea in the last few decades.