Matter and space are connected or related to each other in a particular sense. We might say one has existence because of the other. It was not as if matter first came into existence (or was created) in the already existing space. Space and time did not exist before the creation - appearence - of matter - before the begining of the universe - before 'The Big Bang'.
Right now the universe is fast expanding according to the latest findings in cosmology. This means, the galaxies (matter) are moving further away and at this the space is expanding.
On the other hand, if the galaxies are coming closer, if the universe is contracting the space also will be contracting.
Thus we can say that matter is connected to the fabric of space.