Humans have a remarkable ability to perform precise motor actions, such as threading a needle. Movement variability poses a challenge to producing precise actions. The ability to respond to movement variability may be further hindered by sensorimotor time delays. Two differing but potentially complementary views are that the sensorimotor system regulates feedback gains or muscular co-contraction to mitigate movement variability. To our knowledge, no one has directly manipulated movement variability to support these differing views. We hypothesized that the sensorimotor system modulates both feedback gains and muscular co-contraction in response to movement variability and time delays. Participants were seated with their arm placed on an exoskeleton robot. We collected surface electromyography of six upper-limb muscles. Participants moved their arm to control a cursor on a screen. They kept the cursor within the bounds of a visual channel while reaching towards a target. Participants performed four conditions where we manipulated movement variability (amplified or non-amplified) and/or time delay (delay or no-delay). Movement variability was amplified by doubling the cursor's distance from the channel centerline. Time delays were imposed by delaying cursor feedback in the lateral direction. Co-contraction was calculated as the minimum activation between muscle pairs. To estimate visuomotor feedback gains, on probe trials we laterally shifted the cursor and recorded applied hand force against a stiff channel. With amplified movement variability we found greater elbow and shoulder co-contraction. We found no changes in visuomotor feedback gains. The results suggest that the sensorimotor system regulates movement variability with muscular co-contraction.