Credit Rating Transition is the migration of a debt instrument from one rating to another rating over a period of time. This migration is either an upgrade or a downgrade from an existing rating. This movement indicates the change in the credit quality of the instrument assessed by the rating agency. The International Rating Agencies such as S&Ps, Moody's, and Fitch assess the credit quality of all the debt instrument in their portfolio and assign a rating to the credit quality. This rating changes as and when new information is available about the obligor's financial health.
References
Credit rating transition Wikipedia(Text) CC BY-SA