Atopic dermatitis is often accompanied by a lack of sleep efficiency, which may impact neurocognitive functions. This review assesses the association between sleep quality in atopic dermatitis patients and neurocognitive decline. Databases searched included PubMed, Scopus, and Web of Science from inception to 8 January 2024, adhering to PRISMA guidelines. Cross-sectional and longitudinal studies were included. Records were screened and assessed for eligibility, with 13 studies included in the final analysis. From an initial pool of 4,529 records, 13 studies involving 272,868 participants met the inclusion criteria. The review identified a consistent pattern of sleep disruption in individuals with atopic dermatitis, which was associated with various short-term neurocognitive challenges such as impaired focus, decreased sleep efficiency, and lower IQ. Limited evidence was found for potential long-term cognitive decline associated with chronic atopic dermatitis. Lower sleep quality in atopic dermatitis is associated with neurocognitive deficits. While immediate effects are evident, further research is needed to understand potential long-term consequences. Integrating sleep management into atopic dermatitis care is imperative.