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Sclerotinia stem rot is an economically important disease of canola (Brassica napus) and is caused by the fungal pathogen Sclerotinia sclerotiorum. This study evaluated the differential gene expression patterns of S. sclerotiorum during disease development on two canola lines differing in susceptibility to this pathogen. Sequencing of the mRNA libraries derived from inoculated petioles and mycelium grown on liquid medium generated approximately 164 million Illumina reads, including 95 million 75-bp-single reads, and 69 million 50-bp-paired end reads. Overall, 36% of the quality filter-passed reads were mapped to the S. sclerotiorum reference genome. On the susceptible line, 1301 and 1214 S. sclerotiorum genes were differentially expressed at early (8–16 hours post inoculation (hpi)) and late (24–48 hpi) infection stages, respectively, while on the resistant line, 1311 and 1335 genes were differentially expressed at these stages, respectively. Gene ontology (GO) categories associated with cell wall degradation, detoxification of host metabolites, peroxisome related activities like fatty acid ß-oxidation, glyoxylate cycle, oxidoreductase activity were significantly enriched in the up-regulated gene sets on both susceptible and resistant lines. Quantitative RT-PCR of six selected DEGs further validated the RNA-seq differential gene expression analysis. The regulation of effector genes involved in host defense suppression or evasion during the early infection stage, and the expression of effectors involved in host cell death in the late stage of infection provide supporting evidence for a two-phase infection model involving a brief biotrophic phase during early stages of infection. The findings from this study emphasize the role of peroxisome related pathways along with cell wall degradation and detoxification of host metabolites as the key mechanisms underlying pathogenesis of S. sclerotiorum on B. napus. [ABSTRACT FROM AUTHOR]