In this paper, we focus on the institutionalization of transdisciplinarity (TD) in higher education institutions and how they institutionalize Transdisciplinarity (TD). As such, universities have engaged in different activities to enact TD policies that aim at incorporating TD in their research and teaching. We take the Methodology Center at the Leuphana University of Lüneburg as a case study. We analyze the institutionalization process of TD to shed light on the obstacles that TD faces to become a widespread policy and practice at universities. In adopting a neo-institutionalist approach in our research, we develop a two-level analysis that allow us to compare the formal characteristics given to TD policies with the actual TD practices taking place in universities. Our findings reveal that TD institutionalization at the Methodology Center is at a mid-level and that overall TD institutionalization is an iterative process, in which the two levels mutually can reinforce or hinder each other.