BACKGROUND: Although umbilical cord blood is an accepted alternative to bone marrow for transplantation, allele-matched bone marrow is generally regarded as the preferred graft source. Our aim was to assess leukaemia-free survival after transplantations of these alternatives compared with present HLA-matching practices, and to assess the relative effect of cell dose and HLA match, and their potential interaction on leukaemia-free survival after cord-blood transplantation. METHODS: Outcomes of 503 children (<16 years) with acute leukaemia and transplanted with umbilical cord blood were compared with outcomes of 282 bone-marrow recipients. All transplantation took place in the USA. Recipients of umbilical cord blood were transplanted with grafts that were HLA-matched (n=35) or HLA-mismatched for one (n=201) or two antigens (n=267) (typing at antigen level for HLA-A and HLA-B, and allele level for HLA-DRB1). Bone-marrow recipients were transplanted with grafts that were matched at the allele level for HLA-A, HLA-B, HLA-C, and HLA-DRB (n=116), or mismatched (n=166). The primary endpoint was 5-year leukaemia-free survival. FINDINGS: In comparison with allele-matched bone-marrow transplants, 5-year leukaemia-free survival was similar to that after transplants of umbilical cord blood mismatched for either one or two antigens and possibly higher after transplants of HLA-matched umbilical cord blood. Transplant-related mortality rates were higher after transplants of two-antigen HLA-mismatched umbilical cord blood (relative risk 2.31, p=0.0003) and possibly after one-antigen HLA-mismatched low-cell-dose umbilical-cord-blood transplants (1.88, p=0.0455). Relapse rates were lower after two-antigen HLA-mismatched umbilical-cord-blood transplants (0.54, p=0.0045). INTERPRETATION: These data support the use of HLA-matched and one- or two-antigen HLA-mismatched umbilical cord blood in children with acute leukaemia who need transplantation. Because better HLA matching and higher cell doses significantly decrease the risk of transplant-related mortality after umbilical-cord-blood transplantation, greater investment in large-scale banking is needed to increase HLA diversity.