Insomnia is the most common sleep disorder among adults, especially affecting individuals of advanced age or with neurodegenerative disease. Insomnia is also a common comorbidity across psychiatric disorders. Cognitive behavioral therapy for insomnia (CBT-I) is the first-line treatment for insomnia; a key component of this intervention is restriction of sleep opportunity, which optimizes matching of sleep ability and opportunity, leading to enhanced sleep drive. Despite the well-documented efficacy of CBT-I, little is known regarding how CBT-I works at a cellular and molecular level to improve sleep, due in large part to an absence of experimentally-tractable animals models of this intervention. Here, guided by human behavioral sleep therapies, we developed a Drosophila model for sleep restriction therapy (SRT) of insomnia. We demonstrate that restriction of sleep opportunity through manipulation of environmental cues improves sleep efficiency in multiple short-sleeping Drosophila mutants. The response to sleep opportunity restriction requires ongoing environmental inputs, but is independent of the molecular circadian clock. We apply this sleep opportunity restriction paradigm to aging and Alzheimer's disease fly models, and find that sleep impairments in these models are reversible with sleep restriction, with associated improvement in reproductive fitness and extended lifespan. This work establishes a model to investigate the neurobiological basis of CBT-I, and provides a platform that can be exploited toward novel treatment targets for insomnia.