No. He explicitly rejected it, particularly in his 1520 treatise On the Babylonian Captivity of the Church. He thought that it was a “monstrous” intrusion of Aristotelian philosophy into Christian theology. However, he believed that Christ was truly and corporeally present in the Eucharist along with the true substance of bread and wine.
Or was this one of the reasons he became “Protestant”?
Since there was no pre-existing thing called “Protestant” for Luther to join, the question really makes no sense (as it does, for instance, for Calvin, who did join a pre-existing movement). Let me tackle it this way: from Luther’s perspective, transubstantiation was not a huge deal one way or the other. He thought it was silly and an incidental example of the corruption of Catholic theology, but it wasn’t the thing that really got him going. WRT the Eucharist his main concern was the doctrine of sacrifice, which he saw as distorting the purpose of the Eucharist from a gift God offers us to a sacrifice we offer God (and thus introducing the notion of human merit, which was what he was really concerned about).
From the Catholic point of view, however, *Babylonian Capitivity *was probably the deal-breaker (one Catholic diplomat, Glapion, said in 1521 that if Luther recanted this one book, all the issues raised in his other writings could be negotiated). One of the things I’ve become convinced of through studying the Reformation is that there was an asymmetry between what each side thought the big issues were. The Protestants, especially the Lutherans, tended to see faith vs. works as the main issue. Catholics were primarily concerned with the Protestant assault on the sacraments. You see this at Regensburg in 1541–Cardinal Contarini (yes, I name my alias after him), who was deeply sympathetic to the Protestant understanding of justification, refused to budge an inch on transubstantiation and scuttled the negotiations by so doing (though it probably wouldn’t have mattered, because both Rome and Luther rejected the agreement on justification anyway).
- Are there any non-Catholics (apart from Orthodox) who believe in Transubstantiation?
Well, I think the Old Catholics would. But leaving them on one side, the more extreme Anglo-Catholics (i.e., Anglicans who would claim to be Catholic rather than Protestant) believe in transubstantiation in all but name, and some of them aren’t too scared of the name. (The 39 Articles reject transubstantiation, but Anglo-Catholics don’t care much for the Articles.) My Episcopal church in North Carolina had Benediction and Adoration of the Blessed Sacrament once or twice a year (usually on Shrove Tuesday, as well as the Holy Thursday liturgy which was celebrated just as it would be in a Catholic Church).