Disclosed herein are methods and compositions comprising anti-CD74 and/or anti-HLA-DR antibodies for treatment of GVHD and other immune dysfunction diseases. In preferred embodiments, the anti-CD74 and/or anti-HLA-DR antibodies are effective to deplete antigen-presenting cells, such as dendritic cells. Most preferably, administration of the therapeutic compositions depletes all subsets of APCs, including mDCs, pDCs, B cells and monocytes, without significant depletion of T cells. In alternative embodiments, administration of the therapeutic compositions suppresses proliferation of allo-reactive T cells, while preserving cytomegalovirus (CMV)-specific, CD8+ memory T cells. The compositions and methods provide a novel conditioning regimen for preventing aGVHD and/or treating chronic GVHD, without altering preexisting anti-viral immunity.