Below its Jahn-Teller transition temperature, TJT, NaNiO2 has a monoclinic layered structure consisting of alternating layers of edge-sharing NaO6 and Jahn-Teller-distorted NiO6 octahedra. Above TJT where NaNiO2 is rhombohedral, diffraction measurements show the absence of a cooperative Jahn-Teller distortion, accompanied by an increase in the unit cell volume. Using neutron total scattering, solid-state Nuclear Magnetic Resonance (NMR), and extended X-ray absorption fine structure (EXAFS) experiments as local probes of the structure we find direct evidence for a displacive, as opposed to order-disorder, Jahn-Teller transition at TJT. This is supported by ab initio molecular dynamics (AIMD) simulations. To our knowledge this study is the first to show a displacive Jahn-Teller transition in any material using direct observations with local probe techniques.