As a theory of personality, it shows us the psychological structure of a person. It uses a three-part model called the ego-state model. This model also helps us understand how people function and express personality through behavior.

As a theory of communication, TA enables the analysis of systems and organizations.

TA offers a theory of child development. The concept of a life script or scenario explains how our current life patterns originate in childhood. It also explains the repetition of old childhood survival and relationship-maintenance strategies, even though they are now dysfunctional or can result in painful and self-destructive outcomes. Thus, it also provides us with a theory of psychopathology.

In practice, TA is used as psychotherapy to treat all forms of psychological disorders, from everyday life problems to serious psychoses. Therapy methods are useful in working with individuals, groups, couples, and families.

Outside the therapeutic field, TA is used for educational purposes. It helps teachers and students stay in communication, avoiding unproductive confrontation. It is especially useful in counseling. TA is a powerful tool in management and communication training, as well as organizational analysis. TA is useful wherever an understanding of individuals, relationships, and communication is needed.