PURPOSE OF THE REVIEW: Melanin-concentrating hormone (MCH)-expressing neurons located in the lateral hypothalamus are considered as an integral component of sleep-wake circuitry. However, the precise role of MCH neurons in sleep-wake regulation has remained unclear, despite several years of research employing a wide range of techniques. We review recent data on this aspect, which are mostly inconsistent, and propose a novel role for MCH neurons in sleep regulation. RECENT FINDINGS: While almost all studies using "gain-of-function" approaches show an increase in rapid eye movement sleep (or paradoxical sleep; PS), loss-of-function approaches have not shown reductions in PS. Similarly, the reported changes in wakefulness or non-rapid eye movement sleep (slow-wave sleep; SWS) with manipulation of the MCH system using conditional genetic methods are inconsistent. Currently available data do not support a role for MCH neurons in spontaneous sleep-wake but imply a crucial role for them in orchestrating sleep-wake responses to changes in external and internal environments.