We examine the distinct part of the density autocorrelation function Fd(q,t), also called the intermediate scattering function, from the point of view of the vibration-transit (V-T) theory of monatomic liquid dynamics. A similar study has been reported for the self part, and we study the self and distinct parts separately because their damping processes are not simply related. We begin with the perfect vibrational system, which provides precise definitions of the liquid correlations, and provides the vibrational approximation Fdvib(q,t) at all q and t. Two independent liquid correlations are defined, motional and structural, and these are decorrelated sequentially, with a crossover time tc(q). This is done by two independent decorrelation processes: the first, vibrational dephasing, is naturally present in Fdvib(q,t) and operates to damp the motional correlation; the second, transit-induced decorrelation, is invoked to enhance the damping of motional correlation, and then to damp the structural correlation. A microscopic model is made for the transit drift, the averaged transit motion that damps motional correlation on 0 < t < tc(q). Following the previously developed self-decorrelation theory, a microscopic model is also made for the transit random walk, which damps the structural correlation on t > tc(q). The complete model incorporates a property common to both self and distinct decorrelation: simple exponential decay following a delay period, where the delay is tc(q, the time required for the random walk to emerge from the drift. Our final result is an accurate expression for Fd(q,t) for all q through the first peak in Sd(q). The theory is calibrated and tested using molecular dynamics (MD) calculations for liquid Na at 395K; however, the theory itself does not depend on MD, and we consider other means for calibrating it.