The pathogenesis of severe Plasmodium falciparum malaria is incompletely understood. Since the pathogenic stage of the parasite is restricted to blood, dual RNA-sequencing of host and parasite transcripts in blood can reveal their interactions at a systemic scale. Using reference expression signatures for human leukocytes and parasite developmental stages we established that inter-individual heterogeneity in leukocyte and parasite populations explained a large proportion of the variation in gene expression between samples. After adjustments for leukocyte and parasite proportions, we identified human and parasite gene expression associated with severe disease features in Gambian children. Differences in parasite load explained up to 99% of differential expression of human genes but only a third of the differential expression of parasite genes. Co-expression analyses showed a remarkable co-regulation of host and parasite genes controlling translation, and host granulopoiesis genes uniquely co-regulated and differentially expressed in severe malaria. Our results indicate that high parasite load is the proximal stimulus for severe P. falciparum malaria, that there is an unappreciated role for many parasite genes in determining virulence, and hint at a molecular arms-race between host and parasite to synthesise protein products.