To set the default (server) level transaction timeout in JBoss AS 6, edit the following bean in JBOSS_HOME/server/<servername>/deploy/transaction-jboss-beans.xml file:

<bean name="CoordinatorEnvironmentBean" class="com.arjuna.ats.arjuna.common.CoordinatorEnvironmentBean">

        <annotation>@org.jboss.aop.microcontainer.aspects.jmx.JMX(name="jboss.jta:name=CoordinatorEnvironmentBean", exposedInterface=com.arjuna.ats.arjuna.common.CoordinatorEnvironmentBeanMBean.class, registerDirectly=true)</annotation>

        <constructor factoryClass="com.arjuna.ats.arjuna.common.arjPropertyManager" factoryMethod="getCoordinatorEnvironmentBean"/>

        <property name="enableStatistics">false</property>
        <property name="defaultTimeout">300</property>
    </bean>

As can be seen, the "defaultTimeout" property is set to 300. The value is in seconds. Change it to a value of your choice.