The var multigene family, comprising approximately 60 members, encodes for variants of Plasmodium falciparum erythrocyte membrane protein or PfEMP1, a surface antigen which is crucial for parasite blood stage virulence. var genes are expressed in a mutually exclusive fashion and to evade immune detection, P. falciparum transcriptionally switches from one variant to another. It has been proposed that a biased hierarchical switching pattern optimizes the growth and survival of P. falciparum inside the human host. However, the need to establish a particular hierarchy is not well explored, since the growth advantage to the parasite remains the same even if gene identities are shuffled. Our theoretical analysis based on a Markov chain model, coupled with single cell RNA-seq data analysis, RT-qPCR and RNA-seq measurements, establishes a hierarchical var gene expression pattern underlying the biased switching pattern. Further, inclusion of host immune response in the model suggests that the observed switching hierarchy is beneficial when cells expressing different variants are cleared at variable rates by the immune response. For instance, PfEMP1 variants that are cleared more efficiently by the immune system are expressed stably and at a higher level in the population compared to variants that are cleared slowly by the immune system, with parasites quickly turning off the expression of the slowly cleared variant. Consistent with these findings, analysis of published experimental data showed that stable variants exhibit greater binding affinities to IgM. Taken together, our study provides a mechanistic basis for the hierarchical switching pattern of P. falciparum var genes observed during infection.