One of the goals of sequencing the Plasmodium falciparum genome, the main agent of the most lethal form of malaria, is to facilitate the discovery of vaccine and drug targets. Indeed, the genome sequence has provided a great resource for large-scale microarray and proteomic analyses; however, identifying these targets from a genome having ~60% of genes with unknown function is still an enormous challenge. Here we have resequenced 3545 genes in five parasite isolates, approximately ¾ of all coding genes in P. falciparum. Variation in this parasite is unique relative to other species. Population variation is an order of magnitude smaller than that observed in humans and is predominantly ‘functional’ or nonsynonsymous. Most of the variation resides near telomeric ends of chromosomes. We also identified 107 highly polymorphic genes, some of which encode proteins recognized by human immune systems or are genes encoding potential drug targets. Var genes, which encode variant antigens and are under balancing selection, are significantly more diverse than that of genome average. This study also identified 3762 highly validated single nucleotide polymorphisms (SNPs) and 2698 microsatellites (MS) that were used for genome-wide genotyping, mapping parasite traits and studying parasite recombination rates from a global panel of parasites. The data show that variation is highly structured throughout the genome, that recombination hotspots and coldspots are consistent across populations but variable across chromosomes. Many hotspots overlap with repetitive gene family locations that are known to evolve quickly in the parasite. This structure may either facilitate, or present a formidable obstacle, for the development of disease control strategies.