To study the dwarf mechanism of Ari1327 on molecular level, three stem apex cDNA libraries of Ari1327, Ari971 and tall-culm mutant Ari3697 were constructed and sequenced using Illumina HiSeqTM2000 system, respectively. 4.9 G available transcriptome data were obtained, with 70877 unigenes were spliced. After comparing the transcriptome data of Ari1327 with data of Ari971 and Ari3697, we uncovered 13919 differentially expressed genes, of which 5406 up-regulated while 8513 down-regulated in Ari1327. Gene Ontology functional enrichment and KEGG pathway analysis revealed that the differentially expressed genes enriched in plant hormone signal transduction pathway. After qRT-PCR, we speculated that the signal transduction and interaction of IAA and GA may contribute to dwarfism of Ari1327. We believe that the abundant differentially expressed genes detected by transcriptome sequencing will be beneficial for revealing the mechanism underlying cotton dwarfism which lays the foundation for breeding cotton dwarf gene type.