Graft-versus-host disease, or GVHD, is a major complication of allogeneic hematopoietic stem cell transplantation (alloHSCT) for the treatment of hematologic malignancies. Here, we describe a novel method for preventing GVHD after alloHSCT using high-dose, post-transplantation cyclophosphamide (Cy). Post-transplantation Cy promotes tolerance in alloreactive host and donor T cells, leading to suppression of both graft rejection and GVHD after alloHSCT. High-dose, post-transplantation Cy facilitates partially HLA-mismatched HSCT without severe GVHD and is effective as sole prophylaxis of GVHD after HLA-matched alloHSCT. By reducing the morbidity and mortality of alloHSCT, post-transplantation Cy may expand the applications of this therapy to the treatment of autoimmune diseases and non-malignant hematologic disorders such as sickle cell disease.