Transitions between sleep and wakefulness are regulated by complex neurobiological mechanisms, which ultimately can be delineated as oscillations between two opponent processes--one promoting sleep and the other promoting wakefulness. The suprachiasmatic nuclei (SCN) provide temporal organization to the sleep-wake cycle through arousal mechanisms that oppose homeostatic drive or sleep. Assuming that individual cells in the SCN are competent circadian oscillators, it is important to understand how these cells communicate and remain synchronized with each other. Examination of the brain structures and receptors that are involved in alertness and the complex phenomena involved in regulation of the circadian sleep-wake cycle has provided evidence for an important role for the noradrenergic locus coeruleus (LC) system in the circadian regulation of alertness and performance. However, the broad interest in mechanisms underlying alertness is not solely to understand wakefulness but also to gain insight into how to maintain alertness and cognitive performance while awake. Few studies have attempted to link the role of a brain system in sleep-wake regulation with a role in cognitive performance during waking. We hypothesize that the dorsomedial hypothalamic nucleus (DMH) modulates the circadian rhythm of sleep and waking via projections to the LC. We propose a SCN-DMH-LC signalling pathway that may influence the activity of the LC and thereby a variety of central nervous system functions related to noradrenergic innervations, including alertness, vigilance, attention, learning and memory. The influence of sleep drive on the LC system may be important for our understanding of the deleterious effects of sleep loss on performance, and presents a logical target for developing new treatments to counteract impairments in alertness and performance due to poor quality sleep.