Clinical evidence from the practice of traditional Chinese medicine (TCM) has shown that Baihe (BH), Dihuang (DH), and their compatibility, Baihe Dihuang Tang (BDT) can treat insomnia. However, the sedative and hypnotic mechanisms of these therapies have not been established. This study evaluated the sedative-hypnotic mechanisms of BH, DH and BDT in terms of their effects on neurotransmitters, the neuroendocrine system and cation-chloride co-transporters in a p -chlorophenylalanine (PCPA)-induced insomnia mice model. The insomnia mice model was established by intraperitoneal injection of PCPA. Mice were randomly assigned into four groups that were treated with BH, DH and BDT (2.25 g/kg, 2.25 g/kg, 4.5 g/kg) and saline solution (wt., 0.9%). Behavioral analyses showed that, compared to mice in the control group, motion activities of mice with insomnia were significantly reduced, sleep latency was prolonged while sleep duration was shortened. Compared to control mice, 5-HT and KCC2 levels were decreased, whereas CRH and ACTH levels were elevated in the insomniac mice. Treatment with BH, DH and BDT ameliorated the symptoms of insomnia and significantly reversed the abnormal levels of the aforementioned neurotransmitters. Notably, BDT effects were the most obvious. These results indicate that BH, DH and BDT improves insomniac symptoms by modifying neurotransmitters levels, the neuroendocrine system and cation-chloride co-transporters.