Fractionation of rat liver by homogenization and differential centrifugation revealed that only about 83% of the transglutaminase activity in the tissue is in a soluble form, and that the remainder is associated with the particulate fraction. This latter activity remained with the membranes even after they were extensively washed to remove 99% of such soluble enzymes as lactate dehydrogenase and aldolase. Subsequent fractionation of the membranes by isopycnic density gradient centrifugation in sucrose resulted in a single band of transglutaminase activity at a density of 1.194 g/cm3. This activity was coincident with the major band of plasma membranes, which was identified by its content of 5'-nucleotidase, alkaline phosphodiesterase I, alkaline phosphatase and leucine aminopeptidase activities. After treatment with digitonin and fractionation on sucrose gradients, the transglutaminase activity and the plasma membrane marker enzyme activities were found at a new density of 1.210 g/cm3, while the enzyme markers for the other membrane fractions remained unchanged. From these data, we conclude that approximately 17% of the transglutaminase activity in rat liver is specifically associated with the plasma membranes.