We analyzed the outcome of 25 consecutive patients with chronic hematological malignancy who underwent allogeneic stem-cell transplantation conditioned with fludarabine (30 mg/m2/day, thrice) and total body irradiation (2 Gy). All patients received peripheral blood stem cells from an HLA-identical sibling donor. With a median follow-up of 769 days (range, 244 - 1231), the estimated 2-year overall survival (OS), event-free survival (EFS), transplantation-related mortality and relapse rates were 53%, 45%, 27%, and 39%, respectively. All patients had initial engraftment. Acute Grade II - IV graft-versus-host disease (GVHD) was recorded in 14 patients (56%), including 7 (28%) with Grade III - IV GVHD. Sixteen of the 23 patients (70%) who survived more than 100 days developed chronic GVHD. OS and EFS were adversely influenced by acute Grade III - IV GVHD (p < 0.001 and p = 0.033, respectively), but chronic GVHD seemed to favorably influence these two parameters (p = 0.03 and p < 0.001, respectively). Patients with full-donor chimerism at day 30 had lower relapse rates, as did those who received high-dose allogeneic CD8+ lymphocytes with their graft (p = 0.026). Collectively, these results provide a framework for refining nonmyeloablative conditioning, to improve outcome with an acceptable risk of GVHD.