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Background Stick and leaf insects (Phasmatodea) are an exclusively leaf-feeding order of insects with no record of omnivory, unlike other “herbivorous” Polyneoptera. They represent an ideal system for investigating the adaptations necessary for obligate folivory, including plant cell wall degrading enzymes (PCWDEs). However, their physiology and internal anatomy is poorly understood, with limited genomic resources available. Results We de novo assembled transcriptomes for the anterior and posterior midguts of six diverse Phasmatodea species, with RNA-Seq on one exemplar species, Peruphasma schultei. The latter’s assembly yielded >100,000 transcripts, with over 4000 transcripts uniquely or more highly expressed in specific midgut sections. Two to three dozen PCWDE encoding gene families, including cellulases and pectinases, were differentially expressed in the anterior midgut. These genes were also found in genomic DNA from phasmid brain tissue, suggesting endogenous production. Sequence alignments revealed catalytic sites on most PCWDE transcripts. While most phasmid PCWDE genes showed homology with those of other insects, the pectinases were homologous to bacterial genes. Conclusions We identified a large and diverse PCWDE repertoire endogenous to the phasmids. If these expressed genes are translated into active enzymes, then phasmids can theoretically break plant cell walls into their monomer components independently of microbial symbionts. The differential gene expression between the two midgut sections provides the first molecular hints as to their function in living phasmids. Our work expands the resources available for industrial applications of animal-derived PCWDEs, and facilitates evolutionary analysis of lower Polyneopteran digestive enzymes, including the pectinases whose origin in Phasmatodea may have been a horizontal transfer event from bacteria. Electronic supplementary material The online version of this article (doi:10.1186/1471-2164-15-917) contains supplementary material, which is available to authorized users.