Oceanian studies along with historical work done in the early 1980s provided the impulse for a radically new understanding of tradition. Since then, the merits of conceptualising tradition as an invention or, in other words, construction have been much debated. My research picks up on the current debate, the concern being to devise a new conception of tradition, only this time locating it theoretically within the context of cultural interaction. In this conception, tradition is understood as a context-bound configuration actively shaped in the course of cultural interactions, i.e. a product of old and newly adopted practices articulating with specific contexts. From this conceptual perspective, the analytic point is to elicit the specific power relationships that have a formative influence on cultural interactions, whether these take place between local aspects and global flows, or between various local and regional cultural practices. My talk discusses established (as well as recent) conceptions of tradition, such as have been formulated in studies of various Oceanian cultures; in particular, I will be examining those studies that address the nexus between tradition and political contexts. I then go on to explore the viability (and so the applicability) of thus conceptualising tradition as a context-bound configuration with respect to indigenous discourses and practices in Oceania. To this end, I briefly examine case studies taken from my fieldwork with the Ngaing in Papua New Guinea and the Banabans resettled in Fiji from Banaba Island (in Micronesia).