A generally accepted approach to the analysis of RNA-Seq read count data does not yet exist. We sequenced the mRNA of 726 individuals from the Drosophila Genetic Reference Panel in order to quantify differences in gene expression among single flies. One of our experimental goals was to identify the optimal analysis approach for the detection of differential gene expression among the factors we varied in the experiment: genotype, environment, sex, and their interactions. Here we evaluate three different filtering strategies, eight normalization methods, and two statistical approaches using our data set. We assessed differential gene expression among factors and performed a statistical power analysis using the eight biological replicates per genotype, environment, and sex in our data set. We found that the most critical considerations for the analysis of RNA-Seq read count data were the normalization method, underlying data distribution assumption, and numbers of biological replicates, an observation consistent with previous RNA-Seq and microarray analysis comparisons. Some common normalization methods, such as Total Count, Quantile, and RPKM normalization, did not align the data across samples. Furthermore, analyses using the Median, Quantile, and Trimmed Mean of M-values normalization methods were sensitive to the removal of low-expressed genes from the data set. Although it is robust in many types of analysis, the normal data distribution assumption produced results vastly different than the negative binomial distribution. In addition, at least three biological replicates per condition were required in order to have sufficient statistical power to detect expression differences among the three-way interaction of genotype, environment, and sex. The best analysis approach to our data was to normalize the read counts using the DESeq method and apply a generalized linear model assuming a negative binomial distribution using either edgeR or DESeq software. Genes having very low read counts were removed after normalizing the data and fitting it to the negative binomial distribution. We describe the results of this evaluation and include recommended analysis strategies for RNA-Seq read count data.