The matrix protein 2 (M2) is a spliced product of segment 7 genome of influenza A virus. Previous studies indicate its role in uncoating of the viral ribonucleoprotein complex during viral entry and in membrane scission while budding. Despite its crucial role in the viral life cycle, little is known about its subcellular distribution and dynamics. In this study, we have shown that the M2 protein is translocated from the membrane to the cytoplasm by a retrograde route via endosomes and the Golgi network. It utilizes retromer cargo while moving from the endosome to the trans-Golgi network and prevents endosome fusion with the lysosome. Further, M2 interacts with the endoplasmic-reticulum-resident AAA-ATPase p97 for its release into the cytoplasm. Our study also revealed that the M2 protein in the cellular milieu does not undergo ubiquitin-mediated proteasomal degradation. The migration of M2 through this pathway inside the infected cell suggests possible new roles that the M2 protein may have in the host cytoplasm, apart from its previously described functions.