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In this paper, we propose a robust transformation estimation method based on manifold regularization for non-rigid point set registration. The method iteratively recovers the point correspondence and estimates the spatial transformation between two point sets. The correspondence is established based on existing local feature descriptors which typically results in a number of outliers. To achieve an accurate estimate of the transformation from such putative point correspondence, we formulate the registration problem by a mixture model with a set of latent variables introduced to identify outliers, and a prior involving manifold regularization is imposed on the transformation to capture the underlying intrinsic geometry of the input data. The non-rigid transformation is specified in a reproducing kernel Hilbert space and a sparse approximation is adopted to achieve a fast implementation. Extensive experiments on both 2D and 3D data demonstrate that our method can yield superior results compared to other state-of-the-arts, especially in case of badly degraded data.