Disorders of the ubiquitin-proteasome system (UPS) are known to influence the incidence and mortality of various diseases. It remains largely unknown whether and how the UPS affects the onset and progression of acute graft-versus host disease (aGVHD) after allogeneic hematopoietic stem cell transplantation (allo-HSCT). The present study demonstrated that the deubiquitinase OTUD1 is an essential regulator of aGVHD. Activation of CD4+ T cells after allo-HSCT elevated the protein levels of OTUD1, which in turn interacted with the Notch2-ICD (NICD) to cleave the ubiquitin of NICD at the K1770 site, thereby inducing NICD protein accumulations in T cells. OTUD1-driven NICD signaling promoted the differentiation and functions of Th1 and Th17 cells and amplified the cascade of aGVHD. Moreover, by screening a FDA-approved drugs library the study identified dapagliflozin as an inhibitor targeting the OTUD1/NICD axis. Dapagliflozin administration significantly prolonged the survival of aGVHD mice. The present study characterized a previously unknown role of OTUD1 in T cell-mediated allogeneic responses and provided a promising therapeutic strategy to target OTUD1 for the alleviation of aGVHD.