Dynorphins, the endogenous ligands for kappa-opioid receptors play an essential role in neuroendocrine regulation, stress response, reward processing, and mood control. These neuropeptides induce strong dysphoric and aversive effects. Polymorphisms in the prodynorphin (PDYN), the dynorphin-encoding gene, are associated with substance addiction and negative craving, while dynorphin mutations cause neurodegeneration in the human brain. Similarly to other neuropeptide genes, PDYN is expressed in selective neural circuits at extremely low tissue levels. A sophisticated epigenetic/transcriptional regulation by cell lineage-specific transcription factors (TFs), insulators, and silencers such as CCCTC-binding factor (CTCF) and RE1-silencing transcription factor (REST) along with mechanisms that control neuronal activity-dependent transcription may define spatial, temporal, and adaptive PDYN expression patterns. Impairment of the epigenetic control of PDYN expression may contribute to human pathological conditions including substance dependence, depression, and chronic pain. Epigenetic and environmental factors may mechanistically converge on the PDYN CpG-SNPs associated with a risk for alcohol dependence, and the resulting methylation signals may be translated into disease predisposition via alterations in PDYN transcription. Understanding the mechanisms that regulate neuropeptide epigenome and transcriptome is essential for understanding of neuropeptide-mediated functional connectivity within neural circuits which activities define cognition and behavior.