Alternatively spliced transcript isoforms are thought to play a critical role for functional diversity. However, the mechanism generating the enormous diversity of spliced transcript isoforms remains unknown, and its biological significance remains unclear. We analyzed transcriptomes in saker falcons, chickens, and mice to show that alternative splicing occurs more frequently, yielding more isoforms, in highly expressed genes. We focused on hemoglobin in the falcon, the most abundantly expressed genes in blood, finding that alternative splicing produces 10-fold more isoforms than expected from the number of splice junctions in the genome. These isoforms were produced mainly by alternative use of de novo splice sites generated by transcription-associated mutation (TAM), not by the RNA editing mechanism normally invoked. We found that high expression of globin genes increases mutation frequencies during transcription, especially on nontranscribed DNA strands. After DNA replication, transcribed strands inherit these somatic mutations, creating de novo splice sites, and generating multiple distinct isoforms in the cell clone. Bisulfate sequencing revealed that DNA methylation may counteract this process by suppressing TAM, suggesting DNA methylation can spatially regulate RNA complexity. RNA profiling showed that falcons living on the high Qinghai-Tibetan Plateau possess greater global gene expression levels and higher diversity of mean to high abundance isoforms (reads per kilobases per million mapped reads ≥18) than their low-altitude counterparts, and we speculate that this may enhance their oxygen transport capacity under low-oxygen environments. Thus, TAM-induced RNA diversity may be physiologically significant, providing an alternative strategy in lifestyle evolution.