Indiplon is a short-acting hypnotic that is currently being developed as a treatment for insomnia by Neurocrine Biosciences and Pfizer, and is expected to be marketed in mid-2006. It is a high-affinity allosteric potentiator of GABAA responses that demonstrates preference for alpha1 subunit-containing GABAA receptors. Indiplon will be an addition to the general category of newer-generation hypnotics that now includes zaleplon, zolpidem, zopiclone and eszopiclone. Clinical trials were carried out with an immediate-release capsule and a modified-release tablet and demonstrate very positive efficacy and safety profiles. The major challenge will be developing a commercial success in the crowded insomnia treatment marketplace.