In undrugged, head-restrained rats, neuronal activity was recorded in and around the laterodorsal hypothalamic area where orexin neurones are distributed. Among 22 neurones observed across whole sleep-waking states, half (n = 11) were most active during paradoxical sleep and least active during waking. Others were equally more active during paradoxical sleep and waking than during slow-wave sleep (n = 6), or were most active during waking and least active during paradoxical sleep (n = 3). The majority of neurones started to increase firing activity prior to the transition of sleep-waking states. These results suggest that the area of the hypothalamus containing orexin neurones plays a role in sleep-waking regulation.