TGM2 is a stress-responsive gene that encodes a multifunctional and structurally complex protein called tissue transglutaminase (abbreviated as TG2 or tTG). TGM2 expression is frequently upregulated during inflammation and wounding. Emerging evidence indicates that TGM2 expression is aberrantly upregulated in multiple cancer cell types, particularly those selected for resistance to chemotherapy and radiation therapy and those isolated from metastatic sites. It is becoming increasingly evident that chronic expression of TG2 in epithelial cancer cells initiates a complex series of signaling networks which contributes to the development of drug resistance and an invasive phenotype. For example, forced or basal high expression of TG2 in mammary epithelial cells is associated with activation of nuclear transcription factor-kappa B (NF-κB), Akt, focal adhesion kinase, and hypoxia-inducible factor. All of these changes are considered hallmarks of aggressive tumors. TG2 expression is able to induce the developmentally regulated program of epithelial-to-mesenchymal transition (EMT) and to confer cancer stem cell (CSC) traits in mammary epithelial cells; both EMT and CSCs have been implicated in cancer metastasis and resistance to standard therapies. Importantly, TG2 expression in tumor samples is associated with poor disease outcome, increased drug resistance, and increased incidence of metastasis. These observations imply that TG2 plays a crucial role in promoting an aggressive phenotype in mammary epithelial cells. In this review, we discuss recent evidence that TG2-regulated pathways contribute to the aggressive phenotype in breast cancer.