Kaposi's sarcoma-associated herpesvirus (KSHV) is the etiologic agent of Kaposi's sarcoma (KS). It is endemic in a number of sub-Saharan African countries with infection rate of >50%. The high prevalence of HIV-1 coupled with late presentation of advanced cancer staging make KS the leading cancer in the region with poor prognosis and high mortality. Disease markers and cellular functions associated with KS tumorigenesis remain ill-defined. Several studies have attempted to investigate changes of the gene profile with in vitro infection of monoculture models, which are not likely to reflect the cellular complexity of the in vivo lesion environment. Our approach is to characterize and compare the gene expression profile in KS lesions versus non-cancer tissues from the same individual. Such comparisons could identify pathways critical for KS formation and maintenance. This is the first study that utilized high throughput RNA-seq to characterize the viral and cellular transcriptome in tumor and non-cancer biopsies of African epidemic KS patients. These patients were treated anti-retroviral therapy with undetectable HIV-1 plasma viral load. We found remarkable variability in the viral transcriptome among these patients, with viral latency and immune modulation genes most abundantly expressed. The presence of KSHV also significantly affected the cellular transcriptome profile. Specifically, genes involved in lipid and glucose metabolism disorder pathways were substantially affected. Moreover, infiltration of immune cells into the tumor did not prevent KS formation, suggesting some functional deficits of these cells. Lastly, we found only minimal overlaps between our in vivo cellular transcriptome dataset with those from in vitro studies, reflecting the limitation of in vitro models in representing tumor lesions. These findings could lead to the identification of diagnostic and therapeutic markers for KS, and will provide bases for further mechanistic studies on the functions of both viral and cellular genes that are involved.