Helicobacter pylori causes cellular vacuolation in host cells, a cytotoxic event attributed to vacuolating cytotoxin (VacA) and the presence of permeant weak bases such as ammonia. We report here the role of γ-glutamyl transpeptidase (GGT), a constitutively expressed secretory enzyme of H. pylori, in potentiating VacA-dependent vacuolation formation in H. pylori-infected AGS and primary gastric cells. The enhancement is brought about by GGT hydrolysing glutamine present in the extracellular medium, thereby releasing ammonia which accentuates the VacA-induced vacuolation. The events of vacuolation in H. pylori wild type (WT)- and Δggt-infected AGS cells were first captured and visualized by real-time phase-contrast microscopy where WT was observed to induce more vacuoles than Δggt. By using semi-quantitative neutral red uptake assay, we next showed that Δggt induced significantly less vacuolation in AGS and primary gastric epithelial cells as compared to the parental strain (P<0.05) indicating that GGT potentiates the vacuolating effect of VacA. Notably, vacuolation induced by WT was significantly reduced in the absence of GGT substrate, glutamine (P<0.05) or in the presence of a competitive GGT inhibitor, serine-borate complex. Furthermore, the vacuolating ability of Δggt was markedly restored when co-incubated with purified recombinant GGT (rGGT), although rGGT itself did not induce vacuolation independently. Similarly, the addition of exogenous ammonium chloride as a source of ammonia also rescued the ability of Δggt to induce vacuolation. Additionally, we also show that monoclonal antibodies against GGT effectively inhibited GGT activity and successfully suppressed H. pylori-induced vacuolation. Collectively, our results clearly demonstrate that generation of ammonia by GGT through glutamine hydrolysis is responsible for enhancing VacA-dependent vacuolation. Our findings provide a new perspective on GGT as an important virulence factor and a promising target in the management of H. pylori-associated gastric diseases.