Background: Inter-facility transfer is an important strategy for improving access to specialized health services, but transfers are complicated by over-triage, under-triage, travel burdens, and costs. The purpose of this study is to describe ED-based inter-facility transfer practices within the Veterans Health Administration (VHA) and to estimate the proportion of potentially avoidable transfers. Methods: This observational cohort study included all patients treated in VHA EDs between 2012 and 2014 who were transferred to another VHA hospital. Potentially avoidable transfers were defined as patients who were either discharged from the receiving ED or admitted to the receiving hospital for ≤1 day without having an invasive procedure performed. We conducted facility-and diagnosis-level analyses to identify subgroups of patients for whom potentially avoidable transfers had increased prevalence. Results: Of 6,173,189 ED visits during the 3-year study period, 18,852 (0.3%) were transferred from one VHA ED to another VHA facility. Rural residents were transferred three times as often as urban residents (0.6% vs. 0.2%, p < 0.001), and 22.8% of all VHA-to-VHA transfers were potentially avoidable transfers. The 3 disease categories most commonly associated with inter-facility transfer were mental health (34%), cardiac (12%), and digestive diagnoses (9%). Conclusions: VHA inter-facility transfer is commonly performed for mental health and cardiac evaluation, particularly for patients in rural settings. The proportion that are potentially avoidable is small. Future work should focus on improving capabilities to provide specialty evaluation locally for these conditions, possibly using telehealth solutions.