Jersey and Kashmiri cattle are important dairy breeds that contribute significantly to the total milk production of the Indian northern state of Jammu and Kashmir. The Kashmiri cattle germplasm has been extensively diluted through crossbreeding with Jersey cattle with the goal of enhancing its milk production ability. However, crossbred animals are prone to diseases resulting to unsustainable milk production. This study aimed to provide a comprehensive transcriptome profile of mammary gland epithelial cells at different stages of lactation and to find key differences in genes and pathways regulating milk traits between Jersey and Kashmiri cattle. Mammary epithelial cells (MEC) isolated from milk obtained from six lactating cows (three Jersey and three Kashmiri cattle) on day 15 (D15), D90 and D250 in milk, representing early, mid and late lactation, respectively were used. RNA isolated from MEC was subjected to next-generation RNA sequencing and bioinformatics processing. Casein and whey protein genes were found to be highly expressed throughout the lactation stages in both breeds. Largest differences in differentially expressed genes (DEG) were between D15 vs D90 (1,805 genes) in Kashmiri cattle and, D15 vs D250 (3,392 genes) in Jersey cattle. A total of 1,103, 1,356 and 1,397 genes were differentially expressed between Kashmiri and Jersey cattle on D15, D90 and D250, respectively. Antioxidant genes like RPLPO and RPS28 were highly expressed in Kashmiri cattle. Differentially expressed genes in both Kashmiri and Jersey were enriched for multicellular organismal process, receptor activity, catalytic activity, signal transducer activity, macromolecular complex and developmental process gene ontology terms. Whereas, biological regulation, endopeptidase activity and response to stimulus were enriched in Kashmiri cattle and, reproduction and immune system process were enriched in Jersey cattle. Most of the pathways responsible for regulation of milk production like JAK-STAT, p38 MAPK pathway, PI3 kinase pathway were enriched by DEG in Jersey cattle only. Although Kashmiri has poor milk production efficiency, the present study suggests possible physicochemical and antioxidant properties of Kashmiri cattle milk that needs to be further explored.