The later Wittgenstein contends that the meaning of any proposition lies solely within its use inside a specific language game or form of life, rather than in its correspondence to an independent reality. This perspective raises a central question that has persisted in Western analytic philosophy for over five decades: Should this approach be regarded as a form of transcendental idealism, and does it ultimately lead to epistemological relativism? Employing a descriptive-analytical and critical methodology based on library research, this study first explicates the later Wittgenstein’s language-game theory in relation to his earlier intellectual periods and examines it comparatively against Kant’s transcendental idealism. It subsequently critiques and evaluates the theory based on the epistemological foundations of Transcendent Philosophy (al-Hikmat al-Muta‘aliyah). The findings indicate that despite certain similarities to Kantian transcendental idealism regarding the active role of the knowing subject, Wittgenstein’s theory diverges from it in terms of universality, the nature of the philosophical project, and the status of the thing-in-itself (Ding an sich). Furthermore, when confronted with the foundations of Transcendent Philosophy—particularly the self-evident nature of existence (badahat al-wujud) and the correspondence theory of truth—the theory fails from four perspectives: foundation, method, objective, and outcome, ultimately leading to nothing but self-destruction and internal contradiction. Among the most significant achievements of this research is the negation of any relativism in the problem of knowledge and the substantiation of the possibility of true knowledge for every human being, irrespective of their language game or social context.