Sleep disorders, especially insomnia, are highly prevalent in modern society. Globalisation and the 24-hour economy drive people away from regular sleep-wake rhythms, while demanding life styles make people economise on their sleep necessities. As a possible consequence, more than 30% of adults in first world countries suffer from sleep disturbances. An even larger percentage sleeps irregularly and insufficiently. This may have serious impact on people?s performance at work, in school, and in every other aspect of daily life. Indeed, an increasing body of evidence suggests that sleep is not only essential for physical health, but also for a variety of mental functions. For instance, learning, memory consolidation and emotional coping all appear to benefit from sleep. Accordingly, sleeping problems are highly correlated to stress and play a role in many psychological and neuropsychiatric disorders. The importance of sleep for mental function is not merely due to a general restorative effect of sleep. Rather, it seems to be related to brain-specific processes, whereby information acquired during the day is reprocessed and reorganised. The nature of these processes and their precise effects on mental functions are, however, not clear. The current projects aims to further characterise the role of sleep in cognitive and affective functioning. Moreover, the neural mechanisms underlying the effects of sleep will be addressed. To do so, we will use a multidisciplinary approach involving behavioural studies supported by EEG, fMRI and computational modelling. The results of this project could enhance a more salutary attitude towards sleep in society today. Moreover, they will have important implications for the understanding of sleep disorders as well as other psychological disorders related to sleep disturbances, including posttraumatic stress disorder (PTSD), depression and schizophrenia.