Phenotypic variation in diverse organism-level traits have been studied in Caenorhabditis elegans wild strains, but differences in gene expression and the underlying variation in regulatory mechanisms are largely unknown. Here, we use natural variation in gene expression to connect genetic variants to differences in organismal-level traits, including drug and toxicant responses. We performed transcriptomic analysis on 207 genetically distinct C. elegans wild strains to study natural regulatory variation of gene expression. Using this massive dataset, we performed genome-wide association mappings to investigate the genetic basis underlying gene expression variation and revealed complex genetic architectures. We found a large collection of hotspots enriched for expression quantitative trait loci across the genome. We further used mediation analysis to understand how gene expression variation could underlie organism-level phenotypic variation for a variety of complex traits. These results reveal the natural diversity in gene expression and possible regulatory mechanisms in this keystone model organism, highlighting the promise of gene expression variation in shaping phenotypic diversity.