50 years ago it was found that sleep somehow made memories better and more permanent, but neither sleep nor memory researchers knew enough about sleep and memory to devise robust, effective tests. Today the fields of sleep and memory have grown and what is now understood is astounding. Still, great mysteries remain. What is the functional difference between the subtly different slow oscillation vs the slow wave of sleep and do they really have opposite memory consolidation effects? How do short spindles (e.g. <0.5 s as in schizophrenia) differ in function from longer ones and are longer spindles key to integrating new memories with old? Is the nesting of slow oscillations together with sleep spindles and hippocampal ripples necessary? What happens if all else is fine but the neurochemical environment is altered? Does sleep become maladaptive and “cement” memories into the hippocampal warehouse where they are assembled, together with all of their emotional baggage? Does maladaptive sleep underlie post-traumatic stress disorder and other stress-related disorders? How do we optimize sleep characteristics for top emotional and cognitive function? State of the art findings and current hypotheses will be presented.