The behavior of neutron leakages between nodes is in general spatially coupled and environment dependent. To investigate this phenomenon, a new transverse leakage model characterized by the space-dependent neutron flux expanded into spatially nonseparable polynomials has been developed. The new transverse leakage model incorporated into the nodal expansion method was tested for its accuracy and applicability by performing benchmark problems and applied to a realistic pressurized water reactor core, beginning of cycle 1 of Korea Nuclear Unit 1. The results obtained for homogeneous nodal problems with the explicit representation of the baffle and water reflector show that the new method improves the reactor core physics parameters, and that it improves the nodal power distribution of the conventional models more than a factor of 2, especially in the fuel regions next to the core baffle where the material discontinuity is predominant due to the significant difference in the neutron spectrum.