A collection of spherical particles subjected to horizontal oscillatory fluid flow is known to form chains perpendicular to the direction of the oscillation. We have developed computer simulations to model such a system and have validated them against experiments carried out in a small fluid-filled cell. In both experiment and simulation we find that the particles go through the same stages of evolution from a dispersed initial configuration to an ordered chain structure. We then use our computer simulations to investigate in detail the interactions responsible for chain formation and the interaction between fully formed chains.