This paper presents spatial interpolation techniques to produce finer-scale daily rainfall data from regional climate modeling. Four common interpolation techniques (ANUDEM, Spline, IDW, and Kriging) were compared and assessed against station rainfall data and modeled rainfall. The performance was assessed by the mean absolute error (MAE), mean relative error (MRE), root mean squared error (RMSE), and the spatial and temporal distributions. The results indicate that Inverse Distance Weighting (IDW) method is slightly better than the other three methods and it is also easy to implement in a geographic information system (GIS). The IDW method was then used to produce forty-year (1990–2009 and 2040–2059) time series rainfall data at daily, monthly, and annual time scales at a ground resolution of 100 m for the Greater Sydney Region (GSR). The downscaled daily rainfall data have been further utilized to predict rainfall erosivity and soil erosion risk and their future changes in GSR to support assessments and planning of climate change impact and adaptation in local scale.