Diapause is a life history strategy allowing individuals to arrest development until favourable conditions return, and it is commonly induced by shortened day length that is latitude specific for local populations. Although understanding the evolutionary dynamics of a threshold trait like diapause induction provides insights into the adaptive process and adaptive potential of populations, the genetic mechanism of variation in photoperiodic induction of diapause is not well understood. Here, we investigate genetic variation underlying latitudinal variation in diapause induction and the selection dynamics acting upon it. Using a genomewide scan for divergent regions between two populations of the butterfly Pararge aegeria that differ strongly in their induction thresholds, we identified and investigated the patterns of variation in those regions. We then tested the association of these regions with diapause induction using between-population crosses, finding significant SNP associations in four genes present in two chromosomal regions, one with the gene period, and the other with the genes kinesin, carnitine O-acetyltransferase and timeless. Patterns of allele frequencies in these two regions in population samples along a latitudinal cline suggest strong selection against heterozygotes at two genes within these loci (period, timeless). Evidence for additional loci modifying the diapause decision was found in patterns of allelic change in relation to induction thresholds over the cline, as well as in backcross analyses. Taken together, population-specific adaptations of diapause induction appear to be due to a combination of alleles of larger and smaller effect size, consistent with an exponential distribution of effect sizes involved in local adaption.