Named Archbishop of Santiago de Compostela in 1984 by Pope John Paul II, he played a key role in the hosting of the 4th World Youth Day in 1989.

During his time at the head of the Archdiocese of Madrid, Rouco Varela officiated at numerous royal family events, such as the wedding of Prince Felipe and Letizia Ortiz and the baptism of their daughters, Leonor, Princess of Asturias, and Sofia, Infanta of Spain.

Along with its founder, Kiko Arguello, he has co-ordinated massive rallies on 31 December 2007 and 2008 known as 'family days' to promote the Catholic family model and to oppose same-sex marriage.

[6] During his tenure as Cardinal Archbishop of Madrid, he had the Neo-Gothic Almudena Cathedral decorated with paintings by Neocatechumenal artist Kiko Argüello and mosaics by Father Marko Ivan Rupnik.

He invites them "for a profound, authentic and joyful encounter with Jesus Christ, our Lord and Savior, who calls young people in his Church so that their lives, often depressed and broken, and others fresh and vigorous, will be rooted and built up in Him, the only one who can offer them and give them truth, hope and love; the only one who can show them the right direction and accompany them on the way that leads to genuine and lasting happiness" as he wrote in a letter just before the World Youth Day of 2011.