The neurohormone melatonin is released from the pineal gland in close association with the light-dark cycle. There is a temporal relationship between the nocturnal rise in melatonin secretion and the 'opening of the sleep gate' at night. This association, as well as the sleep promoting effect of exogenous melatonin, implicates the pineal product in the physiological regulation of sleep. Aging is associated with a significant reduction in sleep continuity and quality. A decreased production of melatonin with age is documented in a majority of studies. Diminished nocturnal melatonin secretion with severe disturbances in sleep/wake rhythm has been consistently reported in Alzheimer's disease (AD). A recent survey on the effects of melatonin in sleep disturbances, including all age groups, failed to document significant and clinically meaningful effects of exogenous melatonin on sleep quality, efficiency and latency. However, in clinical trials involving elderly insomniacs and AD patients suffering from sleep disturbances exogenous melatonin has repeatedly been found to be effective in improving sleep. The results indicate that exogenous melatonin is more effective to promote sleep in the presence of a diminished production of endogenous melatonin. A MT1/MT2 receptor analog of melatonin (ramelteon) has recently been introduced as a new type of hypnotics with no evidence of abuse or dependence.