In mouse and man Y chromosome deletions are frequently associated with spermatogenic defects. Mice with extensive deletions of non-pairing Y chromosome long arm (NPYq) are infertile and produce sperm with grossly misshapen heads, abnormal chromatin packaging, and DNA damage. The NPYq-encoded multi-copy gene Sly controls the expression of sex chromosome genes after meiosis and Sly deficiency results in a remarkable upregulation of sex chromosome genes. Sly deficiency has been shown to be the underlying cause of the sperm head anomalies and infertility associated with NPYq gene loss, but it was not known whether it recapitulates sperm DNA damage phenotype. Here, we produced and examined mice with transgenically (RNAi) silenced Sly and demonstrated that these mice have increased incidence of sperm with DNA damage and poorly condensed and insufficiently protaminated chromatin. We also investigated the contribution of each of the two Sly encoded transcript variants and noted that the phenotype was only observed when both variants were knocked-down, and that the phenotype was intermediate in severity compared to mice with severe NPYq deficiency. Our data demonstrate that Sly deficiency is responsible for the sperm DNA damage/chromatin packaging defects observed in mice with NPYq deletions and point to SLY proteins involvement in chromatin reprogramming during spermiogenesis, likely through their effect on the postmeiotic expression of spermiogenic genes. Considering the importance of sperm epigenome for embryonic and fetal development and possibility of its inter-generational transmission, our results are important for future investigations of the molecular mechanisms of this biologically and clinically important process.