Orexin neurons within the lateral hypothalamus play a crucial role in the promotion and maintenance of arousal. Studies have strongly suggested that orexin neurons are an important target in endogenous adenosine-regulated sleep homeostasis. Orexin A induces a robust increase in the firing activity of orexin neurons, while adenosine has an inhibitory effect. Whether the excitatory action of orexins in the lateral hypothalamus actually promotes wakefulness and reverses the sleep-producing effect of adenosine in vivo is less clear. In this study, electroencephalographic and electromyographic recordings were used to investigate the effects of orexin A and adenosine on sleep and wakefulness in rats. We found that microinjection of orexin A into the lateral hypothalamus increased wakefulness with a concomitant reduction of sleep during the first 3 h of post-injection recording, and this was completely blocked by a selective antagonist for orexin receptor 1, SB 334867. The enhancement of wakefulness also occurred after application of the excitatory neurotransmitter glutamate in the first 3 h post-injection. However, in the presence of the NMDA receptor antagonist APV, orexin A did not induce any change of sleep and wakefulness in the first 3 h. Further, exogenous application of adenosine into the lateral hypothalamus induced a marked increase of sleep in the first 3-h post-injection. No significant change in sleep and wakefulness was detected after adenosine application followed by orexin A administration into the same brain area. These findings suggest that the sleep-promoting action of adenosine can be reversed by orexin A applied to the lateral hypothalamus, perhaps by exciting glutamatergic input to orexin neurons via the action of orexin receptor 1.