SEP-363856 is a trace amine-associated receptor 1 (TAAR1) and 5-hydroxytryptamine type 1A (5-HT1A) agonist, currently in Phase 3 clinical trials for the treatment of schizophrenia. Although SEP-363856 activates TAAR1 and 5-HT1A receptors in vitro, an accessible marker of time- and concentration-dependent effects of SEP-363856 in humans is lacking. In rodents, SEP-363856 has been shown to suppress rapid eye movement (REM) sleep. The aim of the current study was to translate the REM sleep effects to humans and determine pharmacokinetic/pharmacodynamic (PK/PD) relationships of SEP-363856 on a measure of brain activity. The effects of SEP-363856 were evaluated in a randomized, double-blind, placebo-controlled, 2-way crossover study of single oral doses (50 and 10 mg) on REM sleep in healthy male subjects (N = 12 at each dose level). Drug concentrations were sampled during sleep to interpolate individual subject's pharmacokinetic trajectories. SEP-363856 suppressed REM sleep parameters with very large effect sizes (>3) following single doses of 50 mg and plasma concentrations ≥100 ng/mL. Below that effective concentration, the 10 mg dose elicited much smaller effects, increasing only the latency to REM sleep (effect size = 1). The PK/PD relationships demonstrated that REM sleep probability increased as drug concentrations declined below 100 ng/mL over the course of the night. SEP-363856 was generally safe and well tolerated at both doses. The REM sleep-suppressing effects of SEP-363856 provide an accessible marker of brain activity, which can aid in dose selection and help elucidate its therapeutic potential in further clinical trials.