Childhood sleep problems are prevalent and relate to a wide range of negative psychological outcomes. However, it remains unclear how biological processes, such as HPA activity, may predict sleep problems over time in childhood in the context of certain parenting environments. Fifty-one mothers and their 18–20 month-old toddlers participated in a short-term longitudinal study assessing how shared variance among morning levels, diurnal change, and nocturnal change in toddlers’ cortisol secretion predicted change in sleep problems in the context of maternal overprotection and critical control. A composite characterized by low variability in, and, to a lesser extent, high morning values of cortisol, predicted increasing sleep problems from age 2 to age 3 when mothers reported high critical control. Results suggest value in assessing shared variance among different indices of cortisol secretion patterns and the interaction between cortisol and the environment in predicting sleep problems in early childhood.