Males and females of Artemia franciscana, a crustacean commonly used in the aquarium trade, are highly dimorphic. Sex is determined by a pair of ZW chromosomes, but the nature and extent of differentiation of these chromosomes is unknown. Here, we characterize the Z chromosome by detecting genomic regions that show lower genomic coverage in female than in male samples, and regions that harbor an excess of female-specific SNPs. We detect many Z-specific genes, which no longer have homologs on the W, but also Z-linked genes that appear to have diverged very recently from their existing W-linked homolog. We assess patterns of male and female expression in two tissues with extensive morphological dimorphism, gonads, and heads. In agreement with their morphology, sex-biased expression is common in both tissues. Interestingly, the Z chromosome is not enriched for sex-biased genes, and seems to in fact have a mechanism of dosage compensation that leads to equal expression in males and in females. Both of these patterns are contrary to most ZW systems studied so far, making A. franciscana an excellent model for investigating the interplay between the evolution of sexual dimorphism and dosage compensation, as well as Z chromosome evolution in general.