Termites are eusocial keystone insect species that feed on wood matter and plants to obtain cellular energy. Certain invasive wood-feeding isopteran termite pests such as Coptotermes (Rhinotermitidae), Macrotermes, Odontotermes and Microtermes species (Termitidae) have caused immense damage to eucalyptus forests in Malaysia, Australia, India, China and Africa due to their increased sensitivity to wood decomposition under warming temperatures, leading to global economic losses. The traditional forest pest management strategies have failed to curb these termite infestations, thereby urgently calling for the deployment of novel methods. A detailed understanding of termites' adaptation and physiology at the molecular level would aid in the development of future management measures utilizing molecular tools such as RNA interference (RNAi). In this study, we have selected the drywood termite, Incisitermes schwarzi (Isoptera: Kalotermitidae), to investigate how these specific termites survive during their voracious feeding on spruce and birch deadwood in a drywood habitat. To understand their wood digestion response and the detoxification behavior of the natural toxins present in deadwood, we conducted a gene expression analysis in different life stages and different tissues. The differential gene expression (DGE) analysis across developmental stages and tissue types revealed multiple gene families related to wood detoxification, wood digestion, the growth and development of the termites and their eusocial behavior and adaptation to biotic- and abiotic-stress-causing agents. Further, to understand the RNAi susceptibility/resistance of the termites, we identified RNAi machinery genes and explored their expression dynamics across the different life stages and tissues in the drywood termites. The differentially expressed genes identified through this study could help in improving our understanding of termites' adaptation to their lignocellulosic habitats and could serve as excellent putative targets for RNAi-based termite management.