Sleep is controlled by two major regulatory systems: a circadian system that drives it with a 24-hour periodicity and a home-ostatic system that ensures that adequate amounts of sleep are obtained. We are using the fruit fly Drosophila melanogaster to understand both types of regulation. With respect to circadian control, we have identified molecular mechanisms that are critical for the generation of a clock. Our recent efforts have focused on the analysis of posttranslational mechanisms, specifically the action of different phosphatases that control the phosphorylation and thereby the stability and/or nuclear localization of circadian clock proteins period (PER) and timeless (TIM). Resetting the clock in response to light is also mediated through posttranslational events that target TIM for degradation by the proteasome pathway; a recently identified ubiquitin ligase, jet lag (JET), is required for this response. Our understanding of the homeostatic control of sleep is in its early stages. We have found that mushroom bodies, which are a site of synaptic plasticity in the fly brain, are important for the regulation of sleep. In addition, through analysis of genes expressed under different behavioral states, we have identified some that are up-regulated during sleep deprivation. Thus, the Drosophila model allows the use of cellular and molecular approaches that should ultimately lead to a better understanding of sleep biology.