Sleep is an essential and evolutionarily conserved behavior that is closely related to synaptic function. However, whether neuroligins (Nlgs), which are cell adhesion molecules involved in synapse formation and synaptic transmission, are involved in sleep is not clear. Here, we show that Drosophila Nlg4 (DNlg4) is highly expressed in large ventral lateral clock neurons (l-LNvs) and that l-LNv-derived DNlg4 is essential for sleep regulation. GABA transmission is impaired in mutant l-LNv, and sleep defects in dnlg4 mutant flies can be rescued by genetic manipulation of GABA transmission. Furthermore, dnlg4 mutant flies exhibit a severe reduction in GABAA receptor RDL clustering, and DNlg4 associates with RDLs in vivo. These results demonstrate that DNlg4 regulates sleep through modulating GABA transmission in l-LNvs, which provides the first known link between a synaptic adhesion molecule and sleep in Drosophila.