Tissue transglutaminase (tTG) is a calcium-dependent enzyme that catalyzes the posttranslational modification of proteins by transamidation of specific polypeptide-bound glutamine residues. Previous in vitro studies have demonstrated that the transamidating activity of tTG requires calcium and is inhibited by GTP. To investigate the endogenous regulation of tTG, a quantitative in situ transglutaminase (TG) activity assay was developed. Treatment of human neuroblastoma SH-SY5Y cells with retinoic acid (RA) resulted in a significant increase in tTG levels and in vitro TG activity. In contrast, basal in situ TG activity did not increase concurrently with RA-induced increased tTG levels. However, stimulation of cells with the calcium-mobilizing drug maitotoxin (MTX) resulted in increases in in situ TG activity that correlated (r2 = 0.76) with increased tTG levels. To examine the effects of GTP on in situ TG activity, tiazofurin, a drug that selectively decreases GTP levels, was used. Depletion of GTP resulted in a significant increase in in situ TG activity; however, treatment of SH-SY5Y cells with a combination of MTX and tiazofurin resulted in significantly less in situ TG activity compared with treatment with MTX alone. This raised the possibility of calcium-dependent proteolysis due to the effects of tiazofurin, because in vitro GTP protects tTG against proteolysis by trypsin. Studies with a selective membrane permeable calpain inhibitor indicated that tTG is likely to be an endogenous substrate of calpain, and that depletion of GTP increases tTG degradation after elevation of intracellular calcium levels. TG activity was also increased in response to activation of muscarinic cholinergic receptors, which increases intracellular calcium through inositol 1,4,5-trisphosphate generation. The results of these experiments demonstrate that selective changes in calcium and GTP regulate the activity and levels of tTG in situ.