Subjective and objective sleep disturbance was studied in children with nocturnal asthma. Relations between such disturbance and daytime psychological function were also explored, including possible changes in learning and behaviour associated with improvements in nocturnal asthma and sleep. Assessments included home polysomnography, parental questionnaires concerning sleep disturbance, behaviour, and mood and cognitive testing. Compared with matched controls, children with asthma had significantly more disturbed sleep, tended to have more psychological problems, and they performed less well on some tests of memory and concentration. In general, improvement of nocturnal asthma symptoms by changes in treatment was followed by improvement in sleep and psychological function in subsequent weeks. The effects of asthma on sleep and the possible psychological consequences are important aspects of overall care.