A short-range regional, two-way coupled atmosphere-ocean-ice model has been recently developed in an attempt to improve, among other things, quantitative precipitation forecasts (QPFs) over southern Ontario, Canada, by incorporating air-lake interaction over the Great Lakes region. Here, we attempt to 1) assess the impact of the air-lake coupling on daily QPFs, as verified against the Canadian Precipitation Analysis and independent observations, over southern Ontario during the period of June 2016-May 2017; and 2) diagnose major physical processes governing the QPF differences between the coupled and uncoupled models by relating precipitation to those processes at the air-water interface and above. Results indicate that the coupled model tends to reduce the area-averaged and monthly averaged daily QPF biases and standard deviations in 5 months of October, November, and December 2016, and April and May 2017, but increase and deteriorate precipitation biases during the summer months. Most of the deteriorations occur during the daytime, while improvements are observed during the nighttime (in 7 of 12 months). During the daytime, slight improvements appear in 2 months. A further diagnosis indicates that the daily QPF differences between the two models are highly correlated with the differences of their sensible and latent heat fluxes. The maximum (minimum) difference of sensible (latent) heat flux in August 2016 (December 2016) is in phase with the maximum (minimum) difference of the two-model daily QPFs. The daily QPF differences in the other months are also controlled by the differences of vertically integrated water vapor flux convergence, and surface temperature.