We formally verify the correctness of Transition System Reduction (TSR), an algorithm used in modelcheckers for temporal logics. Formalizing TSR as a function, we formulate and prove its correctness within the proof assistant PVS. We show how to use a well-ordering on a certain set in a termination proof for the loop-based TSR algorithm. We further detail TSR's partial-correctness proof. The formal framework for these proofs is a part of our research for a rigorous verification environment for reactive systems.