Santalum album (sandalwood) is one of the economically important plant species in the Santalaceae for its production of highly valued perfume oils. Sandalwood is also a hemiparasitic tree that obtains some of its water and simple nutrients by tapping into other plants through haustoria which are highly specialized organs in parasitic angiosperms. However, an understanding of the molecular mechanisms involved in haustorium development is limited. In this study, RNA sequencing (RNA-seq) analyses were performed to identify changes in gene expression and metabolic pathways associated with the development of the S. album haustorium. A total of 56,011 non-redundant contigs with a mean contig size of 618 bp were obtained by de novo assembly of the transcriptome of haustoria and non-haustorial seedling roots. A substantial number of the identified differentially expressed genes were involved in cell wall metabolism and protein metabolism, as well as mitochondrial electron transport functions. Phytohormone-mediated regulation might play an important role during haustorial development. Especially, auxin signaling is likely to be essential for haustorial initiation, and genes related to cytokinin and gibberellin biosynthesis and metabolism are involved in haustorial development. Our results suggest that genes encoding nodulin-like proteins may be important for haustorial morphogenesis in S. album. The obtained sequence data will become a rich resource for future research in this interesting species. This information improves our understanding of haustorium development in root hemiparasitic species and will allow further exploration of the detailed molecular mechanisms underlying plant parasitism.