We evaluated the efficacy of hematopoietic stem cell transplantation (HSCT) using reduced intensity (RI) vs. myeloablative (MA) conditioning for patients with acute myeloid leukemia (AML) and myelodysplastic syndrome. Thirty two patients (median age 54) who underwent a RI HSCT (2000-2003) were compared with 187 patients (median age 39) who received a MA transplant (1990-2003). Neutrophil engraftment was more rapid in the RI group (median 11.5 vs. 21 days). Platelet recovery was similar and graft failure was infrequent. The incidence of graft-versus-host disease (GVHD) and treatment-related mortality was similar though relapse was more frequent after RI conditioning (RR 2.2 [95% CI = 1.1-4.6] P = 0.03). At 2 years, disease-free survival (DFS) (31% vs. 30%, P > 0.1) and overall survival (33% vs. 35%, P > 0.1) were comparable between RI and MA groups, respectively. We suggest that RI allografts can yield satisfactory DFS both for older as well as younger patients with pre-existing comorbidities, who are ineligible for MA allografts. Advances in GVHD management and new approaches for relapsed or refractory disease are necessary to improve these outcomes.