Tissue transglutaminase (TG2) is a multifunctional protein that binds to fibronectin and exerts protein transamidating activity in the presence of Ca(2+). We previously reported that TG2 is upregulated in ovarian tumors and enhances intraperitoneal (i.p.) metastasis. TG2 is secreted abundantly in ovarian cancer (OC) ascites as an active enzyme, yet its function in the extracellular compartment remains unknown. To study the distinct functions of secreted TG2, we used recombinant His6-tagged TG2 and catalytically inactive enzyme in vitro and in vivo. By using i.p. and orthotopic ovarian xenografts, we show that extracellular transglutaminase promoted OC peritoneal metastasis. The main pathway activated by extracellular TG2 was noncanonical nuclear factor-kappa B (NF-κB) signaling, and the enzymatic function of the protein was required to induce phosphorylation of IκB kinase α and processing of the precursor protein p100 into the active p52 subunit. A specific target of TG2-activated p52/RelB complex is the hyaluronan receptor, CD44. Noncanonical NF-κB activation by extracellular TG2 induced CD44 up-regulation and epithelial-to-mesenchymal transition, contributing to increased cancer cell invasiveness and OC peritoneal dissemination. Taken together, our data support that noncanonical NF-κB activation is the pathway through which extracellular TG2 promotes OC metastasis.