The opposite slopes of "Evolution Canyon" in Israel have served as a natural model system of adaptation to a microclimate contrast. Long-term studies of Drosophila melanogaster populations inhabiting the canyon have exhibited significant interslope divergence in thermal and drought stress resistance, candidate genes, mobile elements, habitat choice, mating discrimination, and wing-shape variation, all despite close physical proximity of the contrasting habitats, as well as substantial interslope migration. To examine patterns of genetic differentiation at the genome-wide level, we used high coverage sequencing of the flies' genomes. A total of 572 genes were significantly different in allele frequency between the slopes, 106 out of which were associated with 74 significantly overrepresented gene ontology (GO) terms, particularly so with response to stimulus and developmental and reproductive processes, thus corroborating previous observations of interslope divergence in stress response, life history, and mating functions. There were at least 37 chromosomal "islands" of interslope divergence and low sequence polymorphism, plausible signatures of selective sweeps, more abundant in flies derived from one (north-facing) of the slopes. Positive correlation between local recombination rate and the level of nucleotide polymorphism was also found. adaptive evolution | sequence divergence | genome sequencing