This article shows how the psycholinguistic process of language transfer accounts for the many features of the grammatical morphology of language contact varieties that differ from those of their lexifiers. These include different grammatical categories, the use of contrasting morphological processes to express grammatical distinctions, lexifier grammatical morphemes with new functions, and new grammatical morphemes not found in the lexifier. After an introductory description of the general notion of language transfer, it presents five more specific types: transfer of morphological strategies, word order and grammatical categories, as well as direct morphological transfer and functional transfer. The article then gives some possible explanations for the distribution among different types of contact varieties of two kinds of functional transfer – functionalisation and refunctionalisation – and for the distribution of particular types of grammatical morphemes – i.e. free versus bound. The examples presented come from contact languages of the Australia-Pacific region: three creoles (Australian Kriol, Hawai‘i Creole and Tayo); an expanded pidgin (Melanesian Pidgin, exemplified by Vanuatu Bislama and Papua New Guinea Tok Pisin); a restricted pidgin (Nauru Pidgin); and an indigenised variety of English (Colloquial Singapore English).