Insomnia appears to be a fast-spreading problem in the modern days, which not only affects people's living quality but also impairs people's working efficiency even causing disability. Pharmacological treatment is effective but frequently with significant side effects. Acupuncture is traditionally used for the treatment of insomnia in China and now is widely accepted in the Western countries. Many research works on clinical applications of acupuncture in the treatment of insomnia and the potential mechanisms underlying the acupuncture treatment have been reported. This chapter will try to provide a systematic review on the research findings. A number of clinical studies, mainly randomized controlled clinical trials, have shown positive effects in acupuncture treatment of insomnia. Some of the studies demonstrated that acupuncture treatment appeared to be better than conventional pharmacological drugs in the improvement of insomnia. These encouraging findings are limited by the qualities problems of the methodology used in these clinical studies. The clinical efficacy of acupuncture appeared to be supported by evidence obtained from basic neuroendocrinological studies. A number of studies have demonstrated that acupuncture may modulate a wide range of neuroendocrinological factors following stimulation of acupoints. Evidence has suggested that the clinical efficacy of acupuncture in treatment of insomnia is potentially mediated by a variety of neurotransmitters including norepinephrine, melatonin, gamma-aminobutyric acid, and ?-endorphin. However, due to the complexity, these findings are far from conclusive. More research is necessary. More rigors methodology and integrated approach to evaluate both clinical and basic research evidence are required for future studies.