The main result of this paper is a sparse version of the Graham-Rothschild partition theorem for n n -parameter sets [R. L. Graham and B. L. Rothschild, Ramsey’s theorem for n n -parameter sets, Trans. Amer. Math. Soc. 159 (1971), 257-292]. In particular, a sparse version of Hales-Jewett’s theorem is proved. We give several applications, e.g., for arithmetic progressions and finite sums of integers, confirming conjectures of J. Spencer and of J. Nešetřil and V. Rödl. We also consider graphs defined on parameter sets and prove a sparse and restricted induced partition theorem for such graphs, extending results from [H. J. Prömel, Induced partition properties of combinatorial cubes, J. Combin. Theory Ser. A 39 (1985), 177-208] and [P. Frankl, R. L. Graham, and V. Rödl, Induced restricted Ramsey theorems for spaces, J. Combin. Theory Ser. A 44 (1987), 120-128].