A new set of slip boundary conditions is developed to be used beyond the slip flow-early transition by using more accurate representation of the velocity and temperature gradients at the wall. The new model agrees well with the results from the solution of the Boltzman equation. The effect of rarefaction on steady-state heat transfer in microchannels in the slip flow regime is investigated by the integral transform technique with the implementation of the first order slip boundary conditions. Uniform temperature and/or uniform heat flux boundary conditions are considered for flow between two parallel plates, in circular and rectangular channels and annular sections. Thermal entrance length is solved as well as the fully developed region. Transient effects are obtained by performing the analysis for a cylindrical pipe with a sudden wall temperature change. Two characteristics of rarefaction namely the velocity slip and the temperature jump have opposite effects on heat transfer. It is found that the Nusselt number decreases with increasing rarefaction. Viscous heat dissipation is also included in the analyses and the change in the heat transfer due to this effect is clarified. Viscous heating may increase or decrease the heat transfer coefficient depending on the direction of the external heat transfer.