Among terrestrial organisms, arthropods are especially susceptible to dehydration, given their small body size and high surface area to volume ratio. This challenge is particularly acute for polar arthropods that face near-constant desiccating conditions, as water is frozen and thus unavailable for much of the year. The molecular mechanisms that govern extreme dehydration tolerance in insects remain largely undefined. In this study, we used RNA sequencing to quantify transcriptional mechanisms of extreme dehydration tolerance in the Antarctic midge, Belgica antarctica, the world’s southernmost insect and only insect endemic to Antarctica. Larvae of B. antarctica are remarkably tolerant of dehydration, surviving losses up to 70% of their body water. Gene expression changes in response to dehydration indicated up-regulation of cellular recycling pathways including the ubiquitin-mediated proteasome and autophagy, with concurrent down-regulation of genes involved in general metabolism and ATP production. Metabolomics results revealed shifts in metabolite pools that correlated closely with changes in gene expression, indicating that coordinated changes in gene expression and metabolism are a critical component of the dehydration response. Finally, using comparative genomics, we compared our gene expression results with a transcriptomic dataset for the Arctic collembolan, Megaphorura arctica. Although B. antarctica and M. arctica are adapted to similar environments, our analysis indicated very little overlap in expression profiles between these two arthropods. Whereas several orthologous genes showed similar expression patterns, transcriptional changes were largely species specific, indicating these polar arthropods have developed distinct transcriptional mechanisms to cope with similar desiccating conditions.