Superelastic alloys based on Ti-Nb have potential in the aerospace sector for vibration damping applications, due to their wide mechanical hysteresis and tuneable properties. However, their uptake is currently limited by functional fatigue, whereby a degradation in properties is seen on cyclic loading. To understand the mechanisms that underpin this change in behaviour, a combination of ex situ and in situ testing was used to characterise the evolution of the mechanical response in a commercial Ti-Nb based alloy. It was found that the behaviour of these materials changes via a two-step mechanism, driven by the accumulation of transformation related defects and their associated stress fields. This understanding rationalises many discrepancies within the literature and highlights how the overall shape of the load response of these alloys is dominated by changes occurring only in specific regions of the material.