Transitive performance (TP) is a learning-based behaviour exhibited by a wide range of species, where if a subject has been taught to prefer A when presented with the pair AB but to prefer B when presented with the pair BC, then the subject will also prefer A when presented with the novel pair AC. Most explanations of TP assume that subjects recognize and learn an underlying sequence from observing the training pairs. However, data from squirrel monkeys (Saimiri sciureus) and young children contradict this, showing that when three different items (a triad) are drawn from the sequence, subjects' performance degrades systematically (McGonigle and Chalmers, Nature 267:694-696, 1977; Chalmers and McGonigle, Journal of Experimental Child Psychology 37:355-377, 1984; Harris and McGonigle, The Quarterly Journal of Experimental Psychology 4713:319-348, 1994). We present here the two-tier model, the first learning model of TP which accounts for this systematic performance degradation. Our model assumes primate TP is based on a general-purpose task learning system rather than a special-purpose sequence-learning system. It supports the hypothesis of Heckers et al. (Hippocampus 14:153-162, 2004) that TP is an expression of two separate general learning elements: one for associating actions and contexts, another for prioritising associations when more than one context is present. The two-tier model also provides explanations for why phased training is important for helping subjects learn the initial training pairs and why some subjects fail to do so. It also supports the Harris and McGonigle (The Quarterly Journal of Experimental Psychology 4713:319-348, 1994) explanation of why, once the training pairs have been acquired, subjects perform transitive choice automatically on two-item diads, but not when exposed to triads from the same sequence..