This paper describes how polyphosphoric acid (PPA) is used to modify asphalt in an effort to raise pavement upper service temperatures and to reduce or eliminate rutting. Given the expanding use of PPA, its chemical reaction with asphalt and its effect on binder properties are the subject of great interest. In this perspective, the goal of this work was to acquire an effective understanding of the chemical reactions and physico-chemical effects of PPA onto asphalt so to improve binder design before production. To this end, the morphology, the molecular weight, and the glass transition temperatures of four SHRP asphalts modified with 0%, 0.5% and 1.0% PPA were measured. The results were interpreted based on known reactions of PPA with asphalt model compounds. The findings indicated that upon the reaction of asphalt with PPA, the natural segregation of maltenes and asphaltenes (steric hardening) is facilitated. The chemical basis of this phenomenon was found to reside in great part in the reaction of asphalt indole groups and the disruption of the hydrogen bond network. The effect was a drop in the glass transition temperature (Tg) of the maltenes and a rise in the Tg of the asphaltenes, which respectively correlated to a decrease in the true low performance grade and a rise in the true high performance grade of the binders. The true high temperature performance grade correlated linearly with the temperature at which tan δ =2. The end result is a much-clarified basis for the change in PG upon the PPA modification of binders and a correlation to predict this PG.