To evaluate real, as compared with sham, acupuncture in improving persistent sleep disturbance in veterans with mild traumatic brain injury (mTBI) and posttraumatic stress disorder (PTSD). This sham-controlled randomized clinical trial at a US Department of Veterans Affairs Medical Center (2010-2015) included 60 veterans aged 24-55 years (mean of 40 years) with history of mTBI of at least 3 months and refractory sleep disturbance. Most of these participants (66.7%) carried a concurrent DSM-IV clinical diagnosis of PTSD. For the present study, they were randomized into 2 groups and stratified by PTSD status using the PTSD Checklist-Military Version. Each participant received up to 10 treatment sessions. The primary outcome measure was change in baseline-adjusted global Pittsburgh Sleep Quality Index (PSQI) score following intervention. Secondary outcomes were wrist-actigraphy-assessed objective sleep measurements. Comorbid PTSD was analyzed as a covariate. Mean (SD) preintervention global PSQI score was 14.3 (3.2). Those receiving real acupuncture had a global PSQI score improvement of 4.4 points (relative to 2.4 points in sham, P = .04) and actigraphically measured sleep efficiency (absolute) improvement of 2.7% (relative to a decrement of 5.3% in sham, P = .0016). Effective blinding for active treatment was maintained in the study. PTSD participants presented with more clinically significant sleep difficulties at baseline; acupuncture was effective for both those with and without PTSD. Real acupuncture, compared with a sham needling procedure, resulted in a significant improvement in sleep measures for veterans with mTBI and disturbed sleep, even in the presence of PTSD. These results indicate that an alternative-medicine treatment modality like acupuncture can provide clinically significant relief for a particularly recalcitrant problem affecting large segments of the veteran population. ClinicalTrials.gov identifier: NCT01162317.