During the past 10 years since the discovery of hypocretins (Hcrt, also called orexins), the list of their physiologic implications has been growing, from their primary roles in the sleep-wake cycle and feeding to the control of the cardiovascular system, pain, locomotion, stress, and addiction as well as their involvement in psychiatric disorders such as panic, anxiety, and depression. This diverse set of functions is consistent with the localization of Hcrt neurons in the lateral hypothalamus, a major integrating center of sensory inputs and emotional processes, and their widespread excitatory projections throughout the brain. Newly developed optical tools allow us to manipulate the activity of genetically identified neurons with millisecond precision in vivo and to test specific hypotheses about the causal relationships between Hcrt cells and specific behaviors. Here, we review the basic roles of the Hcrt peptides and discuss how these new technologies increase our understanding of the underpinnings of alertness and arousal.