One-dimensional (1D) analytical model and finite element (FE) simulation are employed to investigate the shock mitigation capability of stepwise graded cellular claddings to underwater blast. To build the analytical model, two types of core configurations are considered: (i) “low → high” with the weakest layer being placed at the impinged end and (ii) the “high → low” configuration. Details of fluid–structure interaction (FSI), response of the graded cladding, and the cavitation phenomenon are thoroughly studied. Then the fidelity of the analytical model is assessed by FE simulations. The results reveal that the analytical model can accurately predict the whole process of such problem. Subsequently, the validated analytical models are used to analyze the influence of density gradient on the shock mitigation capability of cellular claddings in terms of the densification loading, the partial impulse imparted to the cladding, and the work done on the cladding by the external impulse. The results illustrate that the graded claddings perform better than the equivalent uniform case. Compared with the negative density gradient case, the “low → high” configuration with weaker layer being placed at the impinged end is preferable since lower force is transmitted to the protected structure.