diff --git a/moto/autoscaling/models.py b/moto/autoscaling/models.py
index 84601343d..71343a8e0 100644
--- a/moto/autoscaling/models.py
+++ b/moto/autoscaling/models.py
@@ -433,6 +433,12 @@ class AutoScalingBackend(BaseBackend):
             group.instance_states.extend(new_instances)
             self.update_attached_elbs(group.name)
 
+    def set_instance_health(self, instance_id, health_status, should_respect_grace_period):
+        instance = self.ec2_backend.get_instance(instance_id)
+        instance_state = next(instance_state for group in self.autoscaling_groups.values()
+                              for instance_state in group.instance_states if instance_state.instance.id == instance.id)
+        instance_state.health_status = health_status
+
     def detach_instances(self, group_name, instance_ids, should_decrement):
         group = self.autoscaling_groups[group_name]
         original_size = len(group.instance_states)
diff --git a/moto/autoscaling/responses.py b/moto/autoscaling/responses.py
index 16148ab16..05146feba 100644
--- a/moto/autoscaling/responses.py
+++ b/moto/autoscaling/responses.py
@@ -98,6 +98,18 @@ class AutoScalingResponse(BaseResponse):
         template = self.response_template(ATTACH_INSTANCES_TEMPLATE)
         return template.render()
 
+    @amz_crc32
+    @amzn_request_id
+    def set_instance_health(self):
+        instance_id = self._get_param('InstanceId')
+        health_status = self._get_param("HealthStatus")
+        if health_status not in ['Healthy', 'Unhealthy']:
+            raise ValueError('Valid instance health states are: [Healthy, Unhealthy]')
+        should_respect_grace_period = self._get_param("ShouldRespectGracePeriod")
+        self.autoscaling_backend.set_instance_health(instance_id, health_status, should_respect_grace_period)
+        template = self.response_template(SET_INSTANCE_HEALTH_TEMPLATE)
+        return template.render()
+
     @amz_crc32
     @amzn_request_id
     def detach_instances(self):
@@ -568,3 +580,10 @@ DETACH_LOAD_BALANCERS_TEMPLATE = """<DetachLoadBalancersResponse xmlns="http://a
 <RequestId>{{ requestid }}</RequestId>
 </ResponseMetadata>
 </DetachLoadBalancersResponse>"""
+
+SET_INSTANCE_HEALTH_TEMPLATE = """<SetInstanceHealthResponse xmlns="http://autoscaling.amazonaws.com/doc/2011-01-01/">
+<SetInstanceHealthResponse></SetInstanceHealthResponse>
+<ResponseMetadata>
+<RequestId>{{ requestid }}</RequestId>
+</ResponseMetadata>
+</SetInstanceHealthResponse>"""
diff --git a/tests/test_autoscaling/test_autoscaling.py b/tests/test_autoscaling/test_autoscaling.py
index c31444af3..9f5d4b952 100644
--- a/tests/test_autoscaling/test_autoscaling.py
+++ b/tests/test_autoscaling/test_autoscaling.py
@@ -982,3 +982,34 @@ def test_describe_instance_health():
 
     instance1 = response['AutoScalingGroups'][0]['Instances'][0]
     instance1['HealthStatus'].should.equal('Healthy')
+
+@mock_autoscaling
+@mock_ec2
+def test_set_instance_health():
+    client = boto3.client('autoscaling', region_name='us-east-1')
+    _ = client.create_launch_configuration(
+        LaunchConfigurationName='test_launch_configuration'
+    )
+    client.create_auto_scaling_group(
+        AutoScalingGroupName='test_asg',
+        LaunchConfigurationName='test_launch_configuration',
+        MinSize=2,
+        MaxSize=4,
+        DesiredCapacity=2,
+    )
+
+    response = client.describe_auto_scaling_groups(
+        AutoScalingGroupNames=['test_asg']
+    )
+
+    instance1 = response['AutoScalingGroups'][0]['Instances'][0]
+    instance1['HealthStatus'].should.equal('Healthy')
+
+    client.set_instance_health(InstanceId=instance1['InstanceId'], HealthStatus='Unhealthy')
+
+    response = client.describe_auto_scaling_groups(
+        AutoScalingGroupNames=['test_asg']
+    )
+
+    instance1 = response['AutoScalingGroups'][0]['Instances'][0]
+    instance1['HealthStatus'].should.equal('Unhealthy')