Grafted immunocompetent T cells proliferate in the immunocompromised host and reject host cells with "foreign" proteins → severe organ dysfunction. Type IV hypersensitivity reaction.

Features:- Maculopapular rash, jaundice, diarrhea, hepatosplenomegaly- Usually in bone marrow and liver transplants (rich in lymphocytes)- Potentially beneficial in bone marrow transplant for leukemia (graft-versus-tumor effect)