Inhibition of dendritic cell function in solid organ grafts or allogeneic bone marrow transplants prior to or during engraftment by blocking SH2-containing inositol phosphatase (SHIP) expression or function is taught as a method of abrogating immune rejection and thereby increasing the efficacy of engraftment of an allogeneic bone marrow transplant or solid organ allograft or xenograft. Also disclosed is a transgenic mouse having the genotype SHIP.sup.-/- which exhibits enhanced survival following mismatched allogeneic marrow grafts.