PURPOSE: The objective of this study was to describe a postoperative clinical finding coined "sludging." Sludging is defined as a noninflammatory vascular phenomenon observed following ocular surface stem cell transplantation (OSST) characterized by dilated blood vessels localized to the graft. Also, the aim of our study was to identify associated risk factors and the impact on OSST graft outcomes. METHODS: A total of 261 eyes of 196 patients who underwent OSST to treat severe limbal stem cell deficiency from 2006 to 2016 were included in this retrospective review. Clinical characteristics were collected, including patient and donor demographics as well as clinical outcomes. RESULTS: The clinical features of sludging include painless dilation of blood vessels localized on the graft, with an absence of inflammation, limbal injection, and corneal epithelial abnormalities. The overall prevalence of sludging was 77 of 261 eyes (29.5%), and the mean time of appearance after OSST was 1.31 ± 1.48 years. Sludging resolved in 54 of 77 eyes (70.1%) after 0.93 ± 1.04 years. Sludging was most commonly seen after keratolimbal allograft (KLAL) (43.4%) as compared with living-related conjunctival limbal allograft (13.5%, P = 0.00012). The presence of sludging was associated with higher rates of both future graft rejection (P = 0.0012) and graft failure (P = 0.0053). There were no significant donor characteristics associated with developing sludging among KLAL recipients. CONCLUSIONS: Sludging is a noninflammatory postoperative clinical finding following OSST, particularly KLAL. Prompt recognition of sludging is critical to differentiate from acute graft rejection as the management and prognosis is different.