The increased use of variable energy resources in power system operations at both the transmission and distribution levels requires changes to how traditional electricity markets operate to achieve an efficient continual balance of the supply and demand for power. One implication is tighter linkages between transmission and distribution level operations. The availability of smart technology for the management of distributed resources provides an opportunity to consider these issues from a Transactive Energy System (TES) design perspective. A TES design is a collection of economic and control mechanisms permitting the efficient reliable balancing of the supply and demand for power across an entire electrical infrastructure. This thesis proposes a new TES design for the efficient reliable operation of Integrated Transmission and Distribution (ITD) systems. The performance capabilities of this TES design are demonstrated for test cases implemented by means of a newly developed ITD software platform.