Abstract: Melatonin, which is known to have sleep-promoting properties, has no morpho-physiological barriers and readily enters neurons and their subcellular compartments from both the blood and cerebrospinal fluid. It has multiple receptor-dependent and receptor-independent functions. Sleep is a neuronal function, and it can no longer be postulated that one or more anatomical structures fully control sleep. Neurons require sleep for metabolically driven restorative purposes, and as a result, the process of sleep is modulated by peripheral and central mechanisms. This is an important finding because it suggests that melatonin should have intracellular sleep-inducing properties. Based on recent evidence, it is proposed that melatonin induces sleep at the neuronal level independently of its membrane receptors. Thus, the hypnotic action of melatonin and the mechanisms involving the circadian rhythms are separate neurological functions. This is contrary to the presently accepted view.