A different analytical approach to that of the standard causal theory to the explanation of action is proposed. It is argued that the most basic kind of explanation of action is teleological explanation in terms of external reasons. what this amounts to is that an action is the result of a causal process which adapts its results to whatever is objectively practically rational. Explanation in terms of psychological states depends on being able to make this externalist sort of explanation. Central to this account is a theory of causal explanation which depends on the notion of a causal process. A causal process is a real entity distinct from an event. A phenomenon is causally explained when a description of the phenomenon is determined by a theoretical structure which represents how a process which results in the phenomenon works. In teleological explanation, the theoretical structure is that of practical rationality. It is argued that this must be regarded as objective practical rationality. Only purposeful activity can be explained in this way. An account of evolutionary function is provided to show why. it differs from this. This account of teleological explanation, because it does not involve internal mental states, may be used to show how we attribute such states. An agent is essentially a teleological machine. Accounts of perception, beliefs and intentions are provided based on this.