Sleep is a conserved and essential behavior, but its mechanistic and functional underpinnings remain poorly defined. Through unbiased genetic screening in Drosophila, we discovered a novel short-sleep mutant we named argus. Positional cloning and subsequent complementation, CRISPR/Cas9 knock-out, and RNAi studies identified Argus as a transmembrane protein that acts in adult peptidergic neurons to regulate sleep. argus mutants accumulate undigested Atg8a(+) autophagosomes, and genetic manipulations impeding autophagosome formation suppress argus sleep phenotypes, indicating that autophagosome accumulation drives argus short-sleep. Conversely, a blue cheese neurodegenerative mutant that impairs autophagosome formation was identified independently as a gain-of-sleep mutant, and targeted RNAi screens identified additional genes involved in autophagosome formation whose knockdown increases sleep. Finally, autophagosomes normally accumulate during the daytime and nighttime sleep deprivation extends this accumulation into the following morning, while daytime gaboxadol feeding promotes sleep and reduces autophagosome accumulation at nightfall. In sum, our results paradoxically demonstrate that wakefulness increases and sleep decreases autophagosome levels under unperturbed conditions, yet strong and sustained upregulation of autophagosomes decreases sleep, whereas strong and sustained downregulation of autophagosomes increases sleep. The complex relationship between sleep and autophagy suggested by our findings may have implications for pathological states including chronic sleep disorders and neurodegeneration, as well as for integration of sleep need with other homeostats, such as under conditions of starvation.