The Rossby Centre Atmospheric Regional Climate Model (RCA2) is described and simulation results, for the present climate over Europe, are evaluated against available observations. Systematic biases in the models mean climate and climate variability are documented and key parameterization weaknesses identified. The quality of near-surface parameters is investigated in some detail, particularly temperature, precipitation, the surface energy budget and cloud cover. The model simulates the recent, observed climate and variability with a high degree of realism. Compensating errors in the components of the surface radiation budget are highlighted and the fundamental causes of these biases are traced to the relevant aspects of the cloud, precipitation and radiation parameterizations. The model has a tendency to precipitate too frequently at small rates, this has a direct impact on the simulation of cloud-radiation interaction and surface temperatures. Great care must be taken in the use of observations to evaluate high resolution RCMs, when they are forced by analyzed boundary conditions. This is particularly true with respect to precipitation and cloudiness, where observational uncertainty is often larger than the RCM bias.