Factor XIIIa is a transglutaminase that catalyzes intermolecular gamma-glutamyl-epsilon-lysyl bonds between fibrin and other proteins involved in hemostasis. We synthesized 25 peptides from various regions of factor XIIIa and studied their effects on cross-linking fibrin, N,N'-dimethylcasein, or fibronectin. We found that two peptides, Asn72-Asp97 (peptide-4) and Asp190-Phe230 (peptide-7), inhibited factor XIIIa cross-linking of these substrates. The other peptides did not inhibit factor XIIIa activity. The inhibition of cross-linking was reversed by excess substrate, indicating that the peptides were interacting with fibrin and not factor XIIIa. The peptides were not pseudosubstrates since they were not cross-linked to fibrin. The peptides did not modify the primary amine binding site as increasing the primary amine concentration did not reverse inhibition. Peptides-4 and -7 also had no effect on exposure of the active site of factor XIIIa and no synergistic inhibitory effects were detected. Peptides-4 and -7 had no effect on factor XIIIa binding to fibrin suggesting that the binding sites and the substrate recognition sites were distinct. Synthetic peptides containing shorter amino acid sequences of peptide-4 were inactive. In contrast, the amino-terminal (Asp190-Lys199, Tyr194-Tyr204) and the carboxyl-terminal (Lys221-Phe230) portions of peptide-7 were 20-60-fold less inhibitory compared to intact peptide-7. Peptides-4 and -7 also inhibited guinea pig liver tissue transglutaminase from cross-linking fibrinogen, N,N'-dimethylcasein, and fibronectin. In conclusion, we have identified two regions outside the active site pocket which are important for substrate recognition in factor XIIIa and tissue transglutaminase.