You do need two video files, but there are other ways.
For instance, you can split a long video file into pieces by positioning the cursor where you want the split point to occur, and pressing S. Then drag the left and right edges of the two pieces over each other to create a crossfade, but you'll replace the crossfade with something else.
You can also insert media on a track above the longer file, at the points you'd like a transition to occur, and use fade in/fade outpoints to create transitions. This is especially effective with flash-type transitions, but you can create any kind of a transition with this method.
Finally, you can also clip out or copy sections of media and put it on an upper track, and do all sorts of creative things with it for purposes of transition.