Abstract Background Cis-regulatory sequences control gene expression through the coordinated action of transcription factors and their associated partners. Both genetic and epigenetic perturbation of cis-regulatory sequences can lead to novel patterns of gene expression. Phased genome assemblies now enable the local dissection of linkages between cis-regulatory sequences, including their epigenetic state, and gene expression to further characterize gene regulation in heterozygous genomes. Results We assembled a locally phased genome for a mandarin hybrid named ‘Fairchild’ to explore the molecular signatures of allele-specific gene expression. With genome phasing, genes with allele-specific expression were paired with haplotype-specific chromatin states, including levels of chromatin accessibility, histone modifications, and DNA methylation. We found that 30% of variation in allele-specific expression could be attributed to haplotype associated factors, with allelic levels of chromatin accessibility and three histone modifications in gene bodies having the most influence. Structural variants in promoter regions were also associated with allele-specific expression, including specific enrichments of hAT and MULE-MuDR DNA transposon sequences. Mining of cis-regulatory sequences underlying regions with allelic variation in chromatin accessibility revealed a paternally-associated sequence motif bound by ERF48, a target of the Polycomb repressive complex 2 (PRC2), and sequence similarity of this motif corresponded to local levels of H3K27me3, a signature of PRC2 activity. Conclusions Using a locally phased assembly of a heterozygous citrus cultivar, we dissected the interplay between genetic variants and molecular phenotypes with the goal of revealing functional cis-regulatory sequences and exploring the evolution of gene regulation.