Evidence is summarized for the existence of a sleep-regulating mechanism within the preoptic area of the hypothalamus, including the results of lesion, stimulation, and neuronal recording studies. Recent findings employing the c-fos protein immunohistochemical method, have localized putative sleep-regulatory neurons to the ventrolateral preoptic area (vlPOA) and the median preoptic nucleus (MnPn). Electrophysiological studies have confirmed the presence of neurons with sleep-related discharge in the vlPOA. Neurons in the vlPOA that exhibit c-fos protein immunoreactivity during sleep contain the inhibitory neuromodulators galanin and gamma-aminobutyric acid (GABA). These neurons also project to monoaminergic arousal systems, particularly the histaminergic cell groups in the posterior hypothalamus. POA neurons can be hypothesized to provide sleep-related inhibitory control over multiple arousal systems in the forebrain and brainstem.