To test the hypothesis that sleep produced by thalidomide, unlike that of pentobarbital, is associated with increased neuronal activity in the preoptic area (POA), the spontaneous activity of 96 POA neurons was recorded in chronically prepared cats during alert wakefulness (W), deep slow-wave sleep (SWS), and REM sleep in a drug-free preparation and after administration of thalidomide (4 mg/kg) and pentobarbital (4 or 8 mg/kg). Thalidomide, unlike pentobarbital, at a dose that significantly increased the amount of SWS, failed to depress neuronal activity in the POA compared to drug-free controls. Mean discharge rates during thalidomide treatment were similar to drug-free rates. In contrast, rates during low-dose pentobarbital treatment were significantly less than those of drug-free and thalidomide-treated animals. Rates during high-dose pentobarbital treatment were significantly less than those in all other groups. Thalidomide, compared with the other groups, in addition to increasing the amount of SWS, significantly increased the total amount of REM sleep as well as REM sleep as a percent of total sleep, but did not produce ataxia or behavioral excitement. These results do not confirm the initial hypothesis, but suggest that hypnotic drugs that do not depress neuronal activity in the POA may be devoid of some of the unwanted side effects often associated with the more commonly prescribed hypnotic medications.