The effect of tensile deformation in the martensitic state on the transformation behaviour of a polycrystalline near-equiatomic NiTi alloy was investigated by differential scanning calorimetry and thermal mechanical analysis. The experimental results indicated that the process of martensite reorientation proceeded in a Lüders manner over a stress plateau and continued into the next stage of uniform deformation with an increasing stress. The transition of the martensite reorientation process from a localized manner to a uniform manner during tensile deformation of a polycrystalline matrix is yet to be explained. The results also demonstrated that the reorientation deformation was effective in developing a two-way memory effect. The maximum two-way memory effect developed was comparable in magnitude to that developed by conventional training procedures in similar alloys. The deformation also caused a thermal stabilization to the deformed martensite. The stabilization effect was a one-time effect, which vanished once the deformed martensite reverted back to austenite on heating.