Thirty-five patients (25 men and 10 women) with a median age of 20 years with severe aplastic anaemia (SAA) underwent HLA identical stem cell transplantation (HSCT) using a combination of fludarabine and cyclophosphamide +/- anti-thymocyte globulin between 2004 and 2006. Cyclosporine and mini methotrexate were used as GVHD prophylaxis. Graft source included peripheral blood stem cells (28) or G-CSF stimulated bone marrow (7). Two patients expired < 7 days post-HSCT while 32 (91.5%) patients engrafted with a median neutrophil and platelet engraftment time of 12 days each. Three patients (8.5%) developed veno-occlusive disease while acute GVHD occurred in 29% of evaluable patients, with chronic GVHD in 32%. At a mean follow-up of 22 months, 29 (82.8%) are alive and well. When compared with 26 patients previously transplanted using Cy200/antilymphocyte globulin, there was faster neutrophil engraftment (12 vs 16 days; P = 0.002) with significantly lower rejection rates (2.9 vs 30.7%; P = 0.003) and a superior event-free (82.8 vs 38.4%; P = 0.001) and overall survival (82.8 vs 46.1%; P = 0.005). A combination of fludarabine with cyclophosphamide +/- anti-thymocyte globulin reduces rejection and improves overall and event-free survival in Indian patients undergoing HSCT for severe aplastic anaemia.