Tissue transglutaminase (TGase2) is a protein-crosslinking enzyme known to be associated with the in vivo apoptosis program. Here we report that apoptosis could be induced in TGase2-/- mice; however, the clearance of apoptotic cells was defective during the involution of thymus elicited by dexamethasone, anti-CD3 antibody, or gamma-irradiation, and in the liver after induced hyperplasia. The lack of TGase2 prevented the production of active transforming growth factor-beta1 in macrophages exposed to apoptotic cells, which is required for the up-regulation of TGase2 in the thymus in vivo, for accelerating deletion of CD4+CD8+ cells and for efficient phagocytosis of apoptotic bodies. The deficiency is associated with the development of splenomegaly, autoantibodies, and immune complex glomerulonephritis in TGase2-/- mice. These findings have broad implications not only for diseases linked to inflammation and autoimmunity but also for understanding the interrelationship between the apoptosis and phagocytosis process.