Transglutaminase-2 (TGM-2) stabilizes extracellular matrix (ECM) proteins by cross-linking and has been implicated in several fibrotic disorders. Arecoline present in betel quid has been proposed as one of the causative factors for oral submucous fibrosis (OSMF). Hence, we hypothesize that arecoline may regulate TGM-2 and may have a role in the pathogenesis of OSMF. The expression of TGM-2 was studied in OSMF tissues by real-time RT-PCR analysis, and significant overexpression was observed in most OSMF tissues (P=0.0112) compared with normal tissues. Arecoline induced TGM-2 mRNA and protein expression as well as TGM-2 activity in human gingival fibroblast cells. The addition of methocramine hemihydrate (M-2 muscarinic acetylcholine receptor selective antagonist) or 8'-bromo-cAMP abolished arecoline-mediated TGM-2 induction, suggesting a role for M-2 muscarinic acid receptor and a repressor role for cAMP. Our study provides evidence for TGM-2 overexpression in OSMF and its regulation by arecoline in oral fibroblasts.