Study Objectives: To determine whether defining two subtypes of sleep-disordered breathing (SDB) events-with or without hypoxia-results in measures that are more strongly associated with hypertension and sleepiness. Methods: A total of 1 022 participants with 2 112 nocturnal polysomnograms from the Wisconsin Sleep Cohort were analyzed with our automated algorithm, developed to detect breathing disturbances and desaturations. Breathing events were time-locked to desaturations, resulting in two indices-desaturating (hypoxia-breathing disturbance index [H-BDI]) and nondesaturating (nonhypoxia-breathing disturbance index [NH-BDI]) events-regardless of arousals. Measures of subjective (Epworth Sleepiness Scale) and objective (2 981 multiple sleep latency tests from a subset of 865 participants) sleepiness were analyzed, in addition to clinically relevant clinicodemographic variables. Hypertension was defined as BP ≥ 140/90 or antihypertensive use. Results: H-BDI, but not NH-BDI, correlated strongly with SDB severity indices that included hypoxia (r ≥ 0.89, p ≤ .001 with 3% oxygen-desaturation index [ODI] and apnea hypopnea index with 4% desaturations). A doubling of desaturation-associated events was associated with hypertension prevalence, which was significant for ODI but not H-BDI (3% ODI OR = 1.06, 95% CI = 1.00-1.12, p < .05; H-BDI OR 1.04, 95% CI = 0.98-1.10) and daytime sleepiness (β = 0.20 Epworth Sleepiness Scale [ESS] score, p < .0001; β = −0.20 minutes in MSL on multiple sleep latency test [MSLT], p < .01). Independently, nondesaturating event doubling was associated with more objective sleepiness (β = −0.52 minutes in MSL on MSLT, p < .001), but had less association with subjective sleepiness (β = 0.12 ESS score, p = .10). In longitudinal analyses, baseline nondesaturating events were associated with worsening of H-BDI over a 4-year follow-up, suggesting evolution in severity. Conclusions: In SDB, nondesaturating events are independently associated with objective daytime sleepiness, beyond the effect of desaturating events.