Two hydrographic surveys (February 2012 and 2013) in the Indian sector of the SO as well as Argo profiles for the period 2004–2012 were used to study the watermass modification in a cyclonic eddy and an anticyclonic eddy in the STF region. Upward movement of cold and less saline AAIW was evident in the cyclonic eddy whereas downward movement of STSW was seen in the anticyclonic eddy region. The properties of STSW and STMW were extensively changed in the cyclonic eddy region. These changes in the properties of watermasses were cross checked with that of Argo profiles from the cyclonic and anticyclonic eddy regions of the STF. The most important feature observed in both the eddies was a freshening of the AAIW, which was visible in the Argo profiles as well. The analysis showed that the freshening in the AAIW region in the cyclonic eddy was mainly due lifting up of the pycnocline and subsequent intrusion of AAIW from deeper depths. The potential vorticity of eddies and the mean state (noneddy) are found mutually conserved if a sufficient and observed freshening in the AAIW are allowed in the eddy cases especially for the ACE but not much in the case of CE.