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Tranexamic acid (TXA) is an effective hemostatic agent used for the reduction of blood loss and transfusion. However, the safety profile of TXA remains in question due to a potential increased risk of venous thromboembolism. By applying TXA topically as opposed to intravenously, systemic absorption may be reduced and unwanted side-effects mitigated. The objective of our review is to investigate the efficacy and safety of topically applied tranexamic acid compared to both placebo, and the intravenous administration. Cochrane Central Register of Controlled Trials, MEDLINE, Embase, ISI Web of Science, PubMed, and Clinicaltrials.gov were searched from inception to November, 2016. We included randomized controlled trials that compared topical tranexamic acid to either placebo (or standard care) or intravenous administration, in adult patients. Surgical and non-surgical trials were included. Abstract, full-text selection, data extraction and risk of bias assessment were all performed in duplicate. In total, 67 studies involving 6,034 patients met inclusion criteria. The majority of trials evaluated orthopedic procedures. Compared to placebo, the administration of topical TXA significantly reduced the odds of receiving a blood transfusion (pooled OR 0.28, 95% CI 0.20 to 0.38; P < 0.001) and significantly reduced mean blood loss (WMD -276.6, 95% CI -327.8 to -225.4; P < 0.0001). When compared to the intravenous administration, there was no difference between the two groups in terms of transfusion requirements (pooled OR 1.03, 95% CI 0.72 to 1.46; P=0.88) or blood loss (WMD -21.95, 95% CI -66.61 to 27.71; P=0.34). There was no difference in the odds of developing a venous thromboembolic complication between the topical TXA and control groups (pooled OR=0.78, 95% CI 0.47 to 1.29; P=0.33) or the topical and intravenous groups (pooled OR=0.75, 95% CI 0.39 to 1.46; P=0.40). The topical application of TXA effectively reduces both transfusion risk and blood loss compared to placebo, without increasing thromboembolic risks. There were no major differences between topical and intravenous tranexamic acid with respect to safety and efficacy, and both were superior to placebo with regards to blood loss and transfusion requirements. Further study of the topical application is required outside of the field of orthopedics.