The transglutaminases of cultured normal and transformed human keratinocytes (line SV-K14) are characterized. Both cell types display two forms of the enzyme, one of which is cytosoluble (TGc) and the other which is associated with the plasma membrane (TGm). Normal keratinocytes contain predominantly TGm, and SV-K14 cells mainly TGc. The ratio of TGm to TGc can be modulated by the culture conditions and correlates with the competence of the cells to form a cornified envelope. TGm and TGc differ in their biochemical and immunological properties. SDS electrophoresis reveals apparent molecular weights of 92 and 85 kD, respectively. Only the activity of TGc is inhibited in the presence of guanosine 5'-triphosphate. Their response to Ca2+ is different: TGc exhibits a sigmoidal activation kinetics with an A50 value of about 200 microM, whereas the kinetics for TGm is hyperbolic with an A50 value of 75 microM. TGm reacts with a monoclonal antibody raised against epidermal "particulate" transglutaminase, and TGc with a polyclonal antibody raised against guinea pig liver transglutaminase. These reactions are very specific and no cross-reaction occurs. The coappearance of TGm with a proteolytic fragment (Mr 82,000) in the cytosol and intracellular particulate fraction of normal human keratinocytes is probably a preparation artifact.