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Alloreactive donor cytolytic T lymphocytes play a critical role in pathophysiology of acute graft-versus-host disease (GVHD). As GVHD progression involves tumor necrosis factor superfamily receptor activation, and as apoptotic signaling for some tumor necrosis factor superfamily receptors might involve acid sphingomyelinase (ASMase)–mediated ceramide generation, we hypothesized that ASMase deletion would ameliorate GVHD. Using clinically relevant mouse models of acute GVHD in which allogeneic bone marrow and T cells were transplanted into asmase+/+ and asmase−/− hosts, we identify host ASMase as critical for full-blown GVHD. Lack of host ASMase reduced the acute inflammatory phase of GVHD, attenuating cytokine storm, CD8+ T-cell proliferation/activation, and apoptosis of relevant graft-versus-host target cells (hepatocytes, intestinal, and skin cells). Organ injury was diminished in asmase−/− hosts, and morbidity and mortality improved at 90 days after transplantation. Resistance to cytolytic T lymphocyte–induced apoptosis was found at the target cell membrane if hepatocytes lack ASMase, as hepatocyte apoptosis required target cell ceramide generation for formation of ceramide-rich macrodomains, sites concentrating proapoptotic Fas. These studies indicate a requirement for target cell ASMase in evolution of GVHD in liver, small intestines, and skin and provide potential new targets for disease management.