We present high quality, phased genome assemblies representative of taurine and indicine cattle, subspecies that differ markedly in productivity-related traits and environmental adaptation. We report a new haplotype-aware scaffolding and polishing pipeline using contigs generated by the trio binning method to produce haplotype-resolved, chromosome-level genome assemblies of Angus (taurine) and Brahman (indicine) cattle breeds. These assemblies were used to identify structural and copy number variants that differentiate the subspecies and we found variant detection was sensitive to the specific reference genome chosen. Six gene families with immune related functions are expanded in the indicine lineage. Assembly of the genomes of both subspecies from a single individual enabled transcripts to be phased to detect allele-specific expression, and to study genome-wide selective sweeps. An indicus-specific extra copy of fatty acid desaturase is under positive selection and may contribute to indicine adaptation to heat and drought.