Decoding genomic sequences and determining their variation within populations has potential to reveal adaptive processes and unravel the genetic basis of ecologically relevant trait variation within a species. The blue tit Cyanistes caeruleus – a long-time ecological model species – has been used to investigate fitness consequences of variation in mating and reproductive behaviour. However, very little is known about the underlying genetic changes due to natural and sexual selection in the genome of this songbird. As a step to bridge this gap, we assembled the first draft genome of a single blue tit, mapped the transcriptome of five females and five males to this reference, identified genomewide variants and performed sex-differential expression analysis in the gonads, brain and other tissues. In the gonads, we found a high number of sex-biased genes, and of those, a similar proportion were sex-limited (genes only expressed in one sex) in males and females. However, in the brain, the proportion of female-limited genes within the female-biased gene category (82%) was substantially higher than the proportion of male-limited genes within the male-biased category (6%). This suggests a predominant on-off switching mechanism for the female-limited genes. In addition, most male-biased genes were located on the Z-chromosome, indicating incomplete dosage compensation for the male-biased genes. We called more than 500 000 SNPs from the RNA-seq data. Heterozygote detection in the single reference individual was highly congruent between DNA-seq and RNA-seq calling. Using information from these polymorphisms, we identified potential selection signals in the genome. We list candidate genes which can be used for further sequencing and detailed selection studies, including genes potentially related to meiotic drive evolution. A public genome browser of the blue tit with the described information is available at http://public-genomes-ngs.molgen.mpg.de.