Transactive Memory Systems (TMS) are important cognitive constructs to share knowledge and control and coordinate interdependent tasks in teams. The construction of Transactive Memory Systems involves a number of key phases that lead up to the actual formation of a team’s TMS. In particular, the development of Task-Expertise-People (TEP) units, form an essential part of the development of a team’s Transactive Memory System. At this stage very little is known of how Task- Expertise-People units are formed in virtual teams. This paper addresses this problem by following an inductive, quantitative method to develop a measurement scale for TEP formation in virtual teams. TEP formation is a crucial step in developing a high-quality TMS and thus team performance. This is important because many organizations achieve contemporary work using virtual teams and we do not have a measurement scale for TEP formation in virtual teams. Findings from this study indicate that the measurement scale for a TEP unit yields 1) reliable constructs and 2) valid construct items to successfully measure TEP formation.