Classical Hodgkin lymphoma (cHL) is characterized by sparsely distributed Hodgkin and Reed-Sternberg (HRS) cells amid reactive host background, complicating the acquisition of neoplastic DNA without extensive background contamination. We overcame this limitation by using flow-sorted HRS and intratumor T cells and optimized low-input exome sequencing of 10 patient samples to reveal alterations in genes involved in antigen presentation, chromosome integrity, transcriptional regulation, and ubiquitination. β-2-microglobulin (B2M) is the most commonly altered gene in HRS cells, with 7 of 10 cases having inactivating mutations that lead to loss of major histocompatibility complex class I (MHC-I) expression. Enforced wild-type B2M expression in a cHL cell line restored MHC-I expression. In an extended cohort of 145 patients, the absence of B2M protein in the HRS cells was associated with lower stage of disease, younger age at diagnosis, and better overall and progression-free survival. B2M-deficient cases encompassed most of the nodular sclerosis subtype cases and only a minority of mixed cellularity cases, suggesting that B2M deficiency determines the tumor microenvironment and may define a major subset of cHL that has more uniform clinical and morphologic features. In addition, we report previously unknown genetic alterations that may render selected patients sensitive to specific targeted therapies.