Transmission system structure has an essential effect on the reliability of the power system and electricity market performance, especially when producers bid strategically. As part of on-going research on the design of a robust algorithm for expansion planning of the transmission grid in the Australian electricity market, this paper presents a framework which addresses: (1) the security of power delivery to the load points of the transmission system in case of single line outages; (2) the minimization of transmission system lost load; (3) an efficient electricity market for market participants; (4) construction and maintenance costs of transmission augmentation options; and (5) operation efficiency of the transmission grid. The suggested algorithm benefits from the dynamic programming and sensitivity analysis approaches along with the aggregation method in its multi-criteria decision-making to locate the optimum configuration of a future transmission system. A set of indices, which account for impacts of the augmentation options of the transmission grid on five aforementioned reliability and market criteria, are proposed and used in the optimum framework for expansion planning of the transmission grid. Although the methodology is promising for expansion planning of the transmission system, considering the sensitivity analysis concept employed, the proposed methodology would be suitable to detect the sensitive areas of the transmission system to be expanded. The tool would be very useful in the case of large scale power systems for a smart reduction of the transmission expansion options. The proposed methodology has been applied to a 6-bus and a modified IEEE 30-bus test system to show the effectiveness of the sensitivity-based algorithm.