Surprisingly, the concept of sleep, its necessity and function, the mechanisms of action, and its elicitors are far from being completely understood. A key to sleep function is to determine how and when sleep is induced. The aim of this review is to merge the classical concepts of central sleep regulation by the brainstem and hypothalamus with the recent findings on decentral sleep regulation in local neuronal assemblies and sleep regulatory substances that create a scenario in which sleep is both local and use dependent. The interface between these concepts is provided by thalamic cellular and network mechanisms that support rhythmogenesis of sleep-related activity. The brainstem and the hypothalamus centrally set the pace for sleep-related activity throughout the brain. Decentral regulation of the sleep-wake cycle was shown in the cortex, and the homeostat of non-rapid-eye-movement sleep is made up by molecular networks of sleep regulatory substances, allowing individual neurons or small neuronal assemblies to enter sleep-like states. Thalamic neurons provide state-dependent gating of sensory information via their ability to produce different patterns of electrogenic activity during wakefulness and sleep. Many mechanisms of sleep homeostasis or sleep-like states of neuronal assemblies, e.g. by the action of adenosine, can also be found in thalamic neurons, and we summarize cellular and network mechanisms of the thalamus that may elicit non-REM sleep. It is argued that both central and decentral regulators ultimately target the thalamus to induce global sleep-related oscillatory activity. We propose that future studies should integrate ideas of central, decentral, and thalamic sleep generation.