There is a structure in our brainstem known as the reticular formation. It includes ascending pathways which lead to the higher brain and descending pathways which lead to the spinal cord. Its functions include sleep and consciousness. The ascending reticular activating system (ARAS) in particular is involved in behavioral arousal and consciousness as well as the regulation of wakefulness and low consciousness-high consciousness transitions (e.g., transitioning from relaxation to high attention).
According to a behavioral neurophysiological theory propounded by Moruzzi and Magoun in 1949, wakefulness is an active state which is maintained by the ascending reticular activating system, while sleep is a passive state which results from reduction of its activity.
Supporting this theory, when this structure is electrically stimulated with electrodes, it produces arousal from sleep, wakefulness, and consciousness. Moreover, when this area was injured in cats, they exhibited immobility as if they were sleeping. Indeed, injury to the reticular formation can result in irreversible coma.
Under the influence of barbiturates, such as amobarbital, pentobarbital, and secobarbital, the reticular response is difficult to elicit or is abolished, which explains why they produce sleepiness.
On the other hand, lesioning of a different portion of reticular formation produces insomnia in cats.
When REM sleep was discovered, the ascending reticular activating system theory was found to had been wrong.
Now we know that arousal is not facilitated by a single system, but by several distinct neurotransmitter systems, all of which facilitate waking (and REM or Dreaming, which is also a waking state relative to the deeper stages of sleep) through different mechanisms.
These different systems may be responsible for different aspects of wakefulness. The ascending reticular activating system may mediate an externally, not internally, directed vigilance, an awareness of one’s surroundings.
Adenosine for example is a substance that is continuously released in our brains (specifically in the hypothalamus) while we are awake. The more adenosine we have circulating in our brain, the more tired we feel. Adenosine reaches the reticular activating system, where it acts to promote sleep. Caffeine induces wakefulness by inhibiting the release of adenosine.
According to one of the prominent neurochemical theories regarding differences between dreaming and waking consciousness, the unique nature of dream consciousness results from a massive increase of the neurotransmitter acetylcholine from the ascending reticular activating system (ARAS) during REM sleep relative to the neurotransmitters norepinephrine and serotonin.
Another system which affects our wakefulness is influenced by norepinephrine and epinephrine, which may increase arousals and reduce deep and REM sleep due via a stimulation of the RAS.