Although red blood cell (RBC) transfusions can be lifesaving, they are not without risk. In critically ill patients, RBC transfusions are associated with increased morbidity and mortality, which may increase with prolonged RBC storage before transfusion. The mechanisms responsible remain unknown. We hypothesized that acute clearance of a subset of damaged, stored RBCs delivers large amounts of iron to the monocyte/macrophage system, inducing inflammation. To test this in a well-controlled setting, we used a murine RBC storage and transfusion model to show that the transfusion of stored RBCs, or washed stored RBCs, increases plasma nontransferrin bound iron (NTBI), produces acute tissue iron deposition, and initiates inflammation. In contrast, the transfusion of fresh RBCs, or the infusion of stored RBC-derived supernatant, ghosts, or stroma-free lysate, does not produce these effects. Furthermore, the insult induced by transfusion of stored RBC synergizes with subclinical endotoxinemia producing clinically overt signs and symptoms. The increased plasma NTBI also enhances bacterial growth in vitro. Taken together, these results suggest that, in a mouse model, the cellular component of leukoreduced, stored RBC units contributes to the harmful effects of RBC transfusion that occur after prolonged storage. Nonetheless, these findings must be confirmed by prospective human studies.