Can I build a dry room in a moist garage?
The major cause of rust on machine tools is fast changes in temperature during humid weather.

Imagine this scenario: you have a large pile of steel sitting in your cold garage at night. Because the garage is dug into a hill, if the garage is well-insulated, the temperature of the steel will be near the ground temperature, probably around 5 C. During the afternoon, warm, humid weather arrives, and you decide to go out to the garage to do some welding. You open the door, and a breeze of 20 C, humid air blows into the garage and hits the cold metal.

Cold air can't hold as much moisture as warm air. When the warm air hits the cold metal, the air is cooled. (The metal also warms up a little, but more slowly.) If the air is humid enough and cool enough, condensation forms on your steel. That's when you get rust.

To prevent rust, you need to do two things:


Reduce the permeability of the garage to air.
Regulate the temperature of the garage with heater that has a temperature sensor of some sort.


You can try a dehumidifier, but for the cost, I suspect that a heater is a better deal.