The transcription factor XBP1 (X-box-binding protein 1) is essential for plasma cell (PC) differentiation and immunoglobulin secretion. XBP1 is widely expressed, but its activity is precisely controlled by mRNA splicing in response to endoplasmic reticulum (ER) stress. It is the active form of XBP1, XBP1(S), which is required for PC differentiation. The relationship between XBP1(S) expression and PC differentiation in human tissue and its expression in hematologic malignancies has eluded assessment. With a novel antibody, we now define XBP1(S) expression in a large series of normal and neoplastic lymphoid tissues. We establish that XBP1(S) provides a specific marker of advanced plasma differentiation and in lymphoid malignancies is restricted to PC-derived neoplasms and plasmablastic diffuse large B-cell lymphomas. XBP1(S) expression delineates heterogeneity amongst plasmablastic diffuse large B-cell lymphomas, identifying a distinct tumor sub-group. Furthermore, our results establish a direct and practical means of assessing ER stress in human tumors.