Semilocal density functionals for the exchange correlation energy of electrons are extensively used as they produce realistic and accurate results for finite and extended systems. The choice of techniques plays a crucial role in constructing such functionals of improved accuracy and efficiency. An accurate and efficient semilocal exchange energy functional in two dimensions is constructed by making use of the corresponding hole which is derived based on the density matrix expansion. The exchange hole involved is localized under the generalized coordinate transformation and satisfies all the relevant constraints. Comprehensive testing and excellent performance of the functional is demonstrated versus exact exchange results. The accuracy of results obtained by using the newly constructed functional is quite remarkable as it substantially reduces the errors present in the local and nonempirical exchange functionals proposed so far for two-dimensional quantum systems. The underlying principles involved in the functional construction are physically appealing and hold promise for developing range separated and nonlocal exchange functionals in two dimensions.