A toxicity‐reduced conditioning regimen with Treosulfan, Fludarabine, and Thiotepa in patients with high‐risk β‐ thalassemia major has significantly improved HCT outcomes. However, complications resulting from regimen‐related toxicities (RRTs), mixed chimerism, and graft rejection remain a challenge. We evaluated the dose‐exposure‐response relationship of Treosulfan and its active metabolite S, S‐EBDM, in a uniform cohort of patients with β‐thalassemia major to identify whether therapeutic drug monitoring (TDM) and dose adjustment of Treosulfan is feasible. Plasma Treosulfan/S, S‐EBDM levels were measured in seventy‐seven patients using a validated LC‐MS/MS method, and the PK parameters were estimated using nlmixr2. The influence of Treosulfan & S, S‐EBDM exposure, and GSTA1/NQO1 polymorphisms on graft rejection, RRTs, chimerism status, and 1‐year Overall Survival (OS), and Thalassemia Free Survival (TFS) were assessed. We observed that Treosulfan exposure was lower in patients with graft rejection than those without (1655 vs. 2037 mg*h/L, p=0.07). Pharmacodynamic modeling analysis to identify therapeutic cut‐off revealed that Treosulfan exposure ≥1660 mg*hr/L was significantly associated with better 1‐year TFS (97% vs. 81%, p=0.02) and a trend to better 1‐year OS (90% vs. 69%, p=0.07). Further, multivariate analysis adjusting for known PreHCT risk factors also revealed Treosulfan exposure <1660mg*h/L (HR=3.23; 95% CI=1.12‐9.34; p=0.03) and GSTA1*B variant genotype (HR=3.75; 95% CI=1.04‐13.47; p=0.04) to be independent predictors for inferior 1‐year TFS. We conclude that lower Treosulfan exposure increases the risk of graft rejection and early transplant‐related mortality affecting TFS. As no RRTs were observed with increasing Treosulfan exposure, TDM‐based dose adjustment could be feasible and beneficial.