This chapter examines possible neuronal networks and mechanisms responsible for the switch from waking to non-rapid eye movement (NREM) and REM sleep. The activated cortical state during waking is induced by the activity of multiple waking neurochemical systems. In contrast to the complex and extensive neurochemical network involved in waking, the neurons inducing slow-wave sleep (SWS) are localized in the lateral preoptic area and the adjacent basal forebrain. A cluster of these neurons is localized in a small nucleus called the ventrolateral preoptic nucleus (VLPO), which is situated above the optic chiasm. Neurons specifically active during paradoxical sleep (PS) were recorded in the posterior hypothalamus (PH) of cats or head-restrained rats. One-third of these GABAergic neurons were immunoreactive for the neuropeptide melanin concentrating hormone (MCH). PS onset would be due to the activation of glutamatergic PS-on neurons from the sublaterodorsal tegmental nucleus (SLD).