In sleep medicine, patients with sleep disorders are evaluated and treated. The primary assessment tool of the field has traditionally been polysomnography. While polysomnography has been helpful in the evaluation of some sleep disorders, such as sleep apnea syndrome and periodic limb movement disorder, it has been less helpful in others, such as the insomnias, or sleep disorders secondary to mental disorders. These disorders are presumed to stem from some alteration in brain function that disrupts sleep. The development of functional neuroimaging methods provides a means to understand brain function in patients with sleep disorders in a manner not accessible to polysomnography. This paper summarizes functional neuroimaging findings during healthy sleep, then, reviews available studies in sleep disorders patients, and studies addressing the pharmacology of sleep and sleep disorders. Areas in which functional neuroimaging methods may be helpful in sleep medicine, and in which future development is advised, include: (1) clarification of pathophysiology; (2) aid in differential diagnosis; (3) assessment of treatment response; (4) guiding new drug development; and (5) monitoring treatment response.