This article examines the individual and structural factors that promote transition from stable, transitive friendships to unstable, intransitive ones. Arguing that inequalities in social relationships govern this transition, we identify ascribed and achieved characteristics of individuals as well as dyadic and triadic features of their friendships that lead to intransitive ties. Analyses of the friendship choices of 335 elementary school students over a school year reveal important race differences as well as significant effects of network structure on the formation of intransitive ties. Following these intransitive relationships over time confirms their instability. Implications of the findings for the structure of larger social networks are discussed.