The production yields of Upsilon(1S), Upsilon(2S), and Upsilon(3S) quarkonium states are measured through their decays into muon pairs in the CMS detector, in PbPb and pp collisions at the centre-of-mass energy per nucleon pair of 2.76 TeV. The data correspond to integrated luminosities of 166 inverse microbarns and 5.4 inverse picobarns for PbPb and pp collisions, respectively. Differential production cross sections are reported as functions of Upsilon rapidity y up to 2.4, and transverse momentum pT up to 20 GeV/c. A strong centrality-dependent suppression is observed in PbPb relative to pp collisions, by factors of up to approximately 2 and 8, for the Upsilon(1S) and Upsilon(2S) states, respectively. No significant dependence of this suppression is observed as a function of y or pT. The Upsilon(3S) state is not observed in PbPb collisions, which corresponds to a suppression for the centrality-integrated data by at least a factor of approximately 7 at a 95% confidence level. The observed suppression is in agreement with theoretical scenarios modeling the sequential melting of quarkonium states in a quark gluon plasma.