The present work describes the mathematical formulation of a new tray efficiency model through refinement of the conventional residence time distribution (RTD) approach [Foss et al. AIChE J. 1958, 4(2), 231-239]. Geometrical partitioning of a tray into compartments along the main liquid flow direction is a prerequisite in the new model. This partitioning allows computation of the tray efficiency through quantification of the efficiency of the individual compartments. The new model ensures that the fluid dynamics of each compartment contributes toward the overall tray efficiency. This breaks the previous black-box convention of the existing models, which only refer to flow profiles at the tray boundaries. The tray segmentation further aids in analyzing the impact of vapor flow maldistribution on the tray efficiency. The capabilities of the new model are demonstrated in two separate case studies after the model validation for perfectly mixed liquid flow in the compartments and biphasic plug flow on the tray.