Allogeneic hematopoietic stem cell transplantation (HSCT) can cure transfusion-dependent thalassemia (TDT). In a multicenter trial, we investigated the efficacy of reduced intensity conditioning (RIC) before unrelated donor (URD) HSCT in children with TDT. Thirty-three children (1-17 years), received marrow or cord blood (UCB) allografts. Median time to neutrophil engraftment was 13 (range, 10-25) and 24 (range, 18-49) days; platelet engraftment was 23 (range, 12-46) and 50 (range, 31-234) days after marrow and UCB respectively. With median follow-up of 58 (range, 7-79) months, overall and thalassemia-free survival was 82% (95% CI, 0.64-0.92) and 79% (95% CI, 0.6-0.9) respectively. The cumulative incidence (CI) of grade II-IV acute graft-versus-host disease (GVHD) after marrow and UCB was 24% and 44%; the 2-year CI of chronic extensive GVHD was 29% and 21% respectively; 71% (marrow) and 91% (UCB) recipients discontinued systemic immunosuppression by 2 years. Six patients who had Pesaro risk class 2 (N=5) and class 3 (N=1) died of GVHD (N=3), viral pneumonitis (N=2) and pulmonary hemorrhage (N=1). Outcomes following this RIC compared favorably with URD HSCT outcomes for TDT and supported engraftment in 32 of 33 patients. Efforts to reduce GVHD and infectious complications are being pursued further.