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First thing you should do is replace the fluid, seeing you have no idea the age, quality, or type of fluid in the tranny. Do a full fluid swap, meaning replace all the fluid (search the forum on the various methods of doing this). You could take it a step further by dropping the pan and cleaning it, and replacing the filter/screen at the same time.
If after doing a fluid replacement the transmission still shows the same problem, the the unit is indeed faulty and would need to be replace. What car do you have, 4 cylinder of V6?
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2000 Lexus ES300 Millenium Edition 1MZ-FE 64,000 Km
1993 Camry V6 LE 3VZ-FE 164,000 Km SOLD but still in the family
1990 Camry LE 2VZ-FE 202,000 Km
1987 Camry LE 3S-FE 435,000 Km
1971 Corolla 2-door Coupe 2T-C 260,000 miles
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