The sheep is a valuable model to test whether hormone mechanisms that sexually differentiate the brain underlie the expression of sexual partner preferences because as many as 8% of rams prefer same-sex partners. Epigenetic factors such as DNA methylation act as mediators in the interaction between steroid hormones and the genome. Variations in the epigenome could be important in determining morphological or behavior differences among individuals of the same species. In this study, we explored DNA methylation differences in the hypothalamus of male oriented rams (MORs) and female oriented rams (FORs). We employed reduced representation bisulfite sequencing (RRBS) to generate a genome-wide map of DNA methylation and RNA-Seq to profile the transcriptome. We found substantial DNA methylation and gene expression differences between FORs and MORs. Although none of the differentially methylated genes yielded significant functional terms directly associated with sex development, three differentially expressed genes were identified that have been associated previously with sexual behaviors. We hypothesize that these differences are involved in the phenotypic variation in ram sexual partner preferences, whereas future studies will have to find the specific mechanisms. Our results add an intriguing new dimension to sheep behavior that should be useful for further understanding epigenetic and transcriptomic involvement.