Transit Signal Priority (TSP) is an important element of Bus Rapid Transit (BRT) that involves coordinated efforts between transit vehicle detection systems, traffic signal control systems, and communication technologies. Successful deployment of TSP requires thorough laboratory evaluation through simulation before field implementation. This paper presents the development and application of a simulation model specifically designed for the design and evaluation of TSP systems. The proposed simulation tool models in detail all the TSP components in accordance with the National Transportation Communications for ITS Protocol (NTCIP) standard for TSP systems. The study is intended to shed light on how the variety of TSP elements can be addressed in microscopic simulation in a structured and systematic fashion. Sample applications of the model on a real-life arterial corridor in California demonstrate its capabilities and features.