Sleep is a neurochemical process involving sleep promoting and arousal centers in the brain. Sleep performs an essential restorative function and facilitates memory consolidation in humans. The remarkably standardized bouts of consolidated sleep at night and daytime wakefulness reflect an interaction between the homeostatic sleep need that is manifested by increase in sleep propensity after sleep deprivation and decrease during sleep and the circadian pacemaker. Melatonin, the hormone produced nocturnally by the pineal gland, serves as a time cue and sleep-anticipating signal. A close interaction exists between the sleep-wake, melatonin, core temperature, blood pressure, immune and hormonal rhythms leading to optimization of the internal temporal order. With age the robustness of the circadian system decreases and the prevalence of sleep disorders, particularly insomnia, increases. Deviant sleep patterns are associated with increased risks of morbidity, poor quality of life and mortality. Current sleep pharmacotherapies treat insufficient sleep quantity, but fail to improve daytime functioning. New treatment modalities for sleep disorders that will also improve daytime functioning remain a scientific and medical challenge.