Converging lines of evidence strongly support a role for sleep in brain plasticity. An elegant idea that may explain how sleep accomplishes this role is the "synaptic homeostasis hypothesis (SHY)." According to SHY, sleep promotes net synaptic weakening which offsets net synaptic strengthening that occurs during wakefulness. SHY is intuitively appealing because it relates the homeostatic regulation of sleep to an important function (synaptic plasticity). SHY has also received important experimental support from recent studies in Drosophila melanogaster. There remain, however, a number of unanswered questions about SHY. What is the cellular mechanism governing SHY? How does it fit with what we know about plasticity mechanisms in the brain? In this review, I discuss the evidence and theory of SHY in the context of what is known about Hebbian and non-Hebbian synaptic plasticity. I conclude that while SHY remains an elegant idea, the underlying mechanisms are mysterious and its functional significance unknown.