Two transglutaminases (TGases), Factor XIIIa and tissue TGase (tTGase), are expressed in temporal-spatial association with matrix calcification in growth plates. Meniscal and articular cartilage matrix calcification are prevalent in osteoarthritis (OA) and aging. Here, we demonstrated up-regulation of tTGase and Factor XIIIa in superficial and deep zones of knee OA articular cartilage and the central (chondrocytic) zone of OA menisci. Transforming growth factor-beta and interleukin (IL)-1beta induced Factor XIIIa and tTGase expression in cartilage and meniscal organ cultures. Thus, we studied TGase activity. Donor age-dependent, OA severity-related, and IL-1-induced increases in TGase activity were demonstrated in both knee menisci and cultured meniscal cells. Meniscal cell TGase activity was stimulated by nitric oxide donors and tumor necrosis factor-alpha, but transforming growth factor-beta did not stimulate TGase activity. The iNOS inhibitor N-monomethylarginine (NMMA) and an inhibitor of tumor necrosis factor receptor-associated factor (TRAF)2 and TRAF6 signaling (the zinc finger protein A20) suppressed IL-1 induction of TGase activity. Increased Factor XIIIa and tTGase activities, achieved via direct transfection of chondrocytic TC28 and meniscal cells, both induced matrix apatite deposition. Thus, Factor XIIIa and tTGase activities were increased in aging, degenerative cartilages and induced by IL-1. Because TGase activity promoted apatite deposition, our findings potentially implicate inflammation in the pathogenesis of cartilage matrix calcification.