The aim of this study was to elucidate transcriptional changes in the parasitic nematode Teladorsagia circumcincta upon encountering either naïve or immune ovine hosts. Pools of 100,000 exsheathed 3rd stage Teladorsagia circumcincta larvae were exposed in vitro to either an immune or naïve ovine abomasal environment, RNA was extracted from the larvae and sequenced using the Roche 454 platform. Each sample produced approximately 82,000 reads which assembled to give approximately 5,500 isotigs (contigs). The two sequence datasets were clustered together to give a total of 6969 clusters of which mean proportion of reads in 18 were statistically significantly different (P < 0.001) between two groups. Clusters with a predominance of reads in larvae exposed to the immune abomasal environment encoded homologues of genes such as a peptidyl-glycine alpha-amidating monooxygenase homologue, heat shock-protein 16-2 and IDA-1, a tyrosine phosphatase-like receptor protein. Whereas clusters with a predominance of reads in the naïve environment encoded homologues of cytochrome b, EGg Laying defective family member 21 and NADH dehydrogenase subunit 5. Examination of gene ontologies indicates that larvae exposed to the immune environment had increased expression of genes involved in 'carbon utilisation', 'response to stimulus' and 'developmental process'. These data suggest that T. circumcincta modulates gene expression in response to the immune status of the host.