The direction of causation between measures of disrupted sleep, anxiety and depression is not well understood. Under certain conditions, cross-sectional analysis based on genetically informative data can provide important information about the direction of causation between variables. Two community-based samples of 7235 Australian twins aged 18–87 years were mailed an extensive questionnaire that covered a wide range of personality and behavioral measures. Included were self-report measures of disrupted sleep, as well as symptoms of anxiety and depression. Among all females, modeling the direction of causation did not support the hypothesis of sleep having a direct causal impact on risk of anxiety or depression. Among older females, we found evidence that both anxiety and depression interact reciprocally with disrupted sleep, whereas among younger women both anxiety and depression appear to have a causal impact on sleep. Results for males were equivocal. The nosological implications of our findings are discussed.