Internal gravity waves, the subsurface analogue of the familiar surface gravity waves that break on beaches, are ubiquitous in the ocean. Because of their strong vertical and horizontal currents, and the turbulent mixing caused by their breaking, they affect a panoply of ocean processes, such as the supply of nutrients for photosynthesis, sediment and pollutant transport and acoustic transmission; they also pose hazards for man-made structures in the ocean. Generated primarily by the wind and the tides, internal waves can travel thousands of kilometres from their sources before breaking, making it challenging to observe them and to include them in numerical climate models, which are sensitive to their effects. For over a decade, studies have targeted the South China Sea, where the oceans' most powerful known internal waves are generated in the Luzon Strait and steepen dramatically as they propagate west. Confusion has persisted regarding their mechanism of generation, variability and energy budget, however, owing to the lack of in situ data from the Luzon Strait, where extreme flow conditions make measurements difficult. Here we use new observations and numerical models to (1) show that the waves begin as sinusoidal disturbances rather than arising from sharp hydraulic phenomena, (2) reveal the existence of >200-metre-high breaking internal waves in the region of generation that give rise to turbulence levels >10,000 times that in the open ocean, (3) determine that the Kuroshio western boundary current noticeably refracts the internal wave field emanating from the Luzon Strait, and (4) demonstrate a factor-of-two agreement between modelled and observed energy fluxes, which allows us to produce an observationally supported energy budget of the region. Together, these findings give a cradle-to-grave picture of internal waves on a basin scale, which will support further improvements of their representation in numerical climate predictions.