An improved intermediate coupled model (ICM) is described for use in ENSO-related modeling in the tropical Pacific, with ten baroclinic modes included in the vertical and horizonatally varying stratification taken into account. One crucial component of the model is the way in which the subsurface entrainment temperature in the surface mixed layer (T-e) is explicitly used to determine the sea surface temperature (SST) variability. An optimized procedure is developed to depict T-e using inverse modeling from an SST anomaly equation and its empirical relationship with the sea surface pressure variability. The coupled system realistically produces interannual variability associated with ENSO cycles, with a dominant 4-year oscillation. The onset and development of El Nio events from this ICM are examined in view of the well-known delayed oscillator paradigm; an example is given for the evolution of La Nia conditions in model year 2 to El Nio conditions in year 4. Right after a La Nia event (e.g., in year 2), there is a clear signature of reflections at the western boundary in early year 2, with related equatorial signals propagating eastward along the equator into the eastern basin in middle year 2. However, these reflected signals on the equator do not directly lead to an onset of an El Nio event at that time. Instead, approximately 1-year delay, a major El Nio event is seen to develop in the following year (late year 3), at a time when there is no reflected signal explicitly from the western boundary, indicating that the origin of the El Nio event cannot be directly ascribed to the reflection processes. Instead, Kelvin waves in the ocean that actually triggers the El Nio event in early year 3 are generated by interior wind anomalies near the date line that are associated with the first appearance of warm SST anomalies off the equator. Persisted T-e anomalies off the equator in the western tropical Pacific initiate the warm SST anomaly near the date line along the North Equatorial Countercurrent region, which induces wind anomalies and an ocean-atmosphere coupling, leading to the El Nio event in year 4. The relevance of these ICM-based results to other onset mechanisms of El Nio and observations is also discussed.