Chronic insomnia affects 57% of the elderly in the United States, with impairment of quality of life, function, and health. Chronic insomnia burdens society with billions of dollars in direct and indirect costs of care. The main modalities in the treatment of insomnia in the elderly are psychological/behavioral therapies, pharmacological treatment, or a combination of both. Various specialty societies view psychological/behavioral therapies as the initial treatment intervention. Pharmacotherapy plays an adjunctive role when insomnia symptoms persist or when patients are unable to pursue cognitive behavioral therapies. Current drugs for insomnia fall into different classes: orexin agonists, histamine receptor antagonists, non-benzodiazepine gamma aminobutyric acid receptor agonists, and benzodiazepines. This review focuses on Food and Drug Administration (FDA)-approved drugs for insomnia, including suvorexant, low-dose doxepin, Z-drugs (eszopiclone, zolpidem, zaleplon), benzodiazepines (triazolam, temazepam), and ramelteon. We review the indications, dosing, efficacy, benefits, and harms of these drugs in the elderly, and discuss data on drugs that are commonly used off-label to treat insomnia, and those that are in clinical development. The choice of a hypnotic agent in the elderly is symptom-based. Ramelteon or short-acting Z-drugs can treat sleep-onset insomnia. Suvorexant or low-dose doxepin can improve sleep maintenance. Eszopiclone or zolpidem extended release can be utilized for both sleep onset and sleep maintenance. Low-dose zolpidem sublingual tablets or zaleplon can alleviate middle-of-the-night awakenings. Benzodiazepines should not be used routinely. Trazodone, a commonly used off-label drug for insomnia, improves sleep quality and sleep continuity but carries significant risks. Tiagabine, sometimes used off-label for insomnia, is not effective and should not be utilized. Non-FDA-approved hypnotic agents that are commonly used include melatonin, diphenhydramine, tryptophan, and valerian, despite limited data on benefits and harms. Melatonin slightly improves sleep onset and sleep duration, but product quality and efficacy may vary. Tryptophan decreases sleep onset in adults, but data in the elderly are not available. Valerian is relatively safe but has equivocal benefits on sleep quality. Phase II studies of dual orexin receptor antagonists (almorexant, lemborexant, and filorexant) have shown some improvement in sleep maintenance and sleep continuity. Piromelatine may improve sleep maintenance. Histamine receptor inverse agonists (APD-125, eplivanserin, and LY2624803) improve slow-wave sleep but, for various reasons, the drug companies withdrew their products.