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Novelty detection, a widely studied problem in machine learning, is the problem of detecting a novel class of data that has not been previously observed. A common setting for novelty detection is inductive whereby only examples of the negative class are available during training time. Transductive novelty detection on the other hand has only witnessed a recent surge in interest, it not only makes use of the negative class during training but also incorporates the (unlabeled) test set to detect novel examples. Several studies have emerged under the transductive setting umbrella that have demonstrated its advantage over its inductive counterpart. Depending on the assumptions about the data, these methods go by different names (e.g. transductive novelty detection, semi-supervised novelty detection, positive-unlabeled learning, out-of-distribution detection). With the use of generative adversarial networks (GAN), a segment of those studies have adopted a transductive setup in order to learn how to generate examples of the novel class. In this study, we propose TransductGAN, a transductive generative adversarial network that attempts to learn how to generate image examples from both the novel and negative classes by using a mixture of two Gaussians in the latent space. It achieves that by incorporating an adversarial autoencoder with a GAN network, the ability to generate examples of novel data points offers not only a visual representation of novelties, but also overcomes the hurdle faced by many inductive methods of how to tune the model hyperparameters at the decision rule level. Our model has shown superior performance over state-of-the-art inductive and transductive methods. Our study is fully reproducible with the code available publicly.