Deep RNA sequencing was used to simultaneously analyze vaccinia virus (VACV) and HeLa cell transcriptomes at progressive times following infection. VACV, the prototypic member of the poxvirus family, replicates in the cytoplasm and contains a double-stranded DNA genome with ≈200 closely spaced open reading frames (ORFs). The acquisition of a total of nearly 500 million short cDNA sequences allowed construction of temporal strand-specific maps of the entire VACV transcriptome at single-base resolution and analysis of over 14,000 host mRNAs. Before viral DNA replication, transcripts from 118 VACV ORFs were detected; after replication, transcripts from 93 additional ORFs were characterized. The high resolution permitted determination of the precise boundaries of many mRNAs including read-through transcripts and location of mRNA start sites and adjacent promoters. Temporal analysis revealed two clusters of early mRNAs that were synthesized in the presence of inhibitors of protein as well as DNA synthesis, indicating that they do not correspond to separate immediate- and delayed-early classes as defined for other DNA viruses. The proportion of viral RNAs reached 25–55% of the total at 4 h. This rapid change, resulting in a relative decrease of the vast majority of host mRNAs, can contribute to the profound shutdown of host protein synthesis and blunting of antiviral responses. At 2 h, however, a minority of cellular mRNAs was increased. The overrepresented functional categories of the up-regulated RNAs were NF-κB cascade, apoptosis, signal transduction, and ligand-mediated signaling, which likely represent the host response to invasion.