RATIONALE: Allogeneic hematopoietic stem cell transplant (HSCT) is a treatment that can cure acute leukemia and myelodysplasia. After giving the patient chemotherapy and total body irradiation to stop the growth of cancer and remove the patient's diseased bone marrow, healthy stem cells from a donor are infused into the patient to replace the patient's bone marrow and make red and white blood cells and platelets. Unfortunately HSCT is often complicated by 'graft versus host disease' (GVHD) in which the transplanted cells from a donor can make an immune response against the body's normal cells and cause tissue damage and severe symptoms. Removing a subset of the donor T cells, called 'naive T cells', before transplant may reduce the frequency and intensity of GVHD.

PURPOSE: This phase II trial will determine whether the removal of the naive T cells from donor cells can decrease the rate and severity of graft-vs-host disease while preserving specific immunity against infections in patients with acute leukemia or advanced myelodysplastic syndromes.