A catastrophic last interglacial Laurentide outburst (LILO) event approximately 125,000 years ago (125 ka) may have contributed to abrupt climate change during the last interglacial. It has been proposed that this event was an analog of the Holocene 8.2 ka event. We characterize in detail the (1) provenance, (2) timing, and (3) delivery mechanism of a layer of red sediments deposited across much of the northwestern Atlantic Ocean at 125 ka. Our observations provide strong support for the occurrence of a LILO event that was analogous to the 8.2 ka event in all three aspects, and likely surpassed it in magnitude. The freshwater discharge associated with the 125 ka LILO event may explain a series of abrupt global changes, including a reduction of the North Atlantic Deep Water and reinvigoration of the Antarctic Bottom Water. Our findings suggest that the mechanism that triggered the LILO event may be an integral part of the deglacial sequence of events, during which the final collapse of the contiguous Laurentide Ice Sheet took place 3.5–4 k.y. after full interglacial temperature was reached in the middle and high northern latitudes.