Neuroimaging studies have produced seemingly contradictory findings in regards to the pathophysiology of insomnia. Although most study results are interpreted from the perspective of a “hyperarousal” model, the aggregate findings from neuroimaging studies suggest a more complex model is needed. We provide a review of the major findings from neuroimaging studies, then discuss them in relation to a heuristic model of sleep-wake states that involves three major factors: wake drive, sleep drive, and level of conscious awareness. We propose that insomnia involves dysregulation in these factors, resulting in subtle dysregulation of sleep-wake states throughout the 24 h light/dark cycle.