The present study evaluated the hypothesis that developmental changes in hypothalamic sleep-regulatory neuronal circuits contribute to the maturation of sleep homeostasis in rats during the fourth postnatal week. In a longitudinal study, we quantified electrographic measures of sleep during baseline and in response to sleep deprivation (SD) on postnatal days 21/29 (P21/29) and P22/30 (experiment 1). During 24-h baseline recordings on P21, total sleep time (TST) during the light and dark phases did not differ significantly. On P29, TST during the light phase was significantly higher than during the dark phase. Mean duration of non-rapid-eye-movement (NREM) sleep bouts was significantly longer on P29 vs. P21, indicating improved sleep consolidation. On both P22 and P30, rats exhibited increased NREM sleep amounts and NREM electroencephalogram delta power during recovery sleep (RS) compared with baseline. Increased NREM sleep bout length during RS was observed only on P30. In experiment 2, we quantified activity of GABAergic neurons in median preoptic nucleus (MnPN) and ventrolateral preoptic area (VLPO) during SD and RS in separate groups of P22 and P30 rats using c-Fos and glutamic acid decarboxylase (GAD) immunohistochemistry. In P22 rats, numbers of Fos(+)GAD(+) neurons in VLPO did not differ among experimental conditions. In P30 rats, Fos(+)GAD(+) counts in VLPO were elevated during RS. MnPN neuronal activity was state-dependent in P22 rats, but Fos(+)GAD(+) cell counts were higher in P30 rats. These findings support the hypothesis that functional emergence of preoptic sleep-regulatory neurons contributes to the maturation of sleep homeostasis in the developing rat brain.