A bag making and packaging machine includes a conveying unit, a transverse sealing mechanism, and a gusset forming mechanism. The conveying unit is configured and arranged to continuously convey a tubular packaging material. The transverse sealing mechanism has a pair of sealing jaws configured and arranged to revolvingly move while following annular loci to seal the tubular packaging material in a transverse direction with respect to a conveyance direction of the tubular packaging material. The gusset forming mechanism has a pair of folding members configured and arranged to be pressed against side portions of the tubular packaging material to form gussets in the side portions of the tubular packaging material while the folding members move along the conveyance direction of the tubular packaging material before the transverse sealing mechanism seals the tubular packaging material.