The neurobiology of sleep and narcolepsy is reviewed. Non-rapid eye movement (NREM) sleep is generated by neurons in the preoptic region of the hypothalamus and adjacent basal forebrain. Lesions in these regions cause insomnia. Stimulation of these regions rapidly produces sleep onset. The key brain structure for generating REM sleep is the pons and adjacent portions of the midbrain. Damage to the pons and/or caudal midbrain can cause abnormalities in REM sleep. The persistent sleepiness of narcolepsy is a result of a loss of hypocretin function.