To test the impact of genetic heterogeneity on cis-and trans-mediated mechanisms of gene expression regulation, we profiled the transcriptome of adipose tissue in 20 inbred congenic strains derived from diabetic Goto– Kakizaki (GK) rats and Brown–Norway (BN) controls, which contain well-defined blocks (1–183 Mb) of genetic poly-morphisms, and in 123 genetically heterogeneous rats of an (GK · BN)F2 offspring. Within each congenic we identified 73–1351 differentially expressed genes (DEGs), only 7.7% of which mapped within the congenic blocks, and which may be regulated in cis. The remainder localized outside the blocks, and therefore must be regulated in trans. Most trans-regulated genes exhibited approximately twofold expression changes, consistent with monoallelic expression. Altered biological pathways were replicated between congenic strains sharing blocks of genetic polymor-phisms, but polymorphisms at different loci also had redundant effects on transcription of common distant genes and pathways. We mapped 2735 expression quantitative trait loci (eQTL) in the F2 cross, including 26% predominantly cis-regulated genes, which validated DEGs in congenic strains. A hotspot of .300 eQTL in a 10 cM region of chromosome 1 was enriched in DEGs in a congenic strain. However, many DEGs among GK, BN and congenic strains did not replicate as eQTL in F2 hybrids, demonstrating distinct mechanisms of gene expression when alleles segregate in an outbred population or are fixed homozygous across the entire genome or in short genomic regions. Our analysis provides conceptual advances in our understanding of the complex architecture of genome expression and pathway regulation, and suggests a prominent impact of epistasis and monoallelic expression on gene transcription.