Benzodiazepines are prescribed for the treatment of adolescent sleep disorders; however, benzodiazepine overdoses occur, often in combination with opioids. To evaluate whether benzodiazepine treatment for sleep disorders, compared with alternative pharmacologic treatments (trazodone, hydroxyzine, zolpidem, zaleplon, and eszopiclone), is associated with increased risk of drug overdose for young people. This cohort study included privately insured people 10 to 29 years of age identified from a US commercial claims database (MarketScan), from January 1, 2009, to December 31, 2018. Young people with a sleep disorder diagnosis initiating benzodiazepine (n = 23 084) or comparator pharmacologic treatments (n = 66 706) were included in the study. Statistical analysis was performed from November 1, 2021, to May 16, 2022. New use of benzodiazepine treatment or comparator pharmacologic treatments (defined as ≥1 year without a prescription for benzodiazepine or comparator medications). Incident diagnosed drug overdoses were identified from inpatient and emergency department records within 6 months of treatment initiation. The propensity score-adjusted cumulative incidence of overdose and hazard ratios (HRs) were estimated with intention-to-treat (analyzed based on initial treatment) and as-treated analyses (added censoring at treatment discontinuation). Results were stratified by prior prescription opioid fill. The cohort included 23 084 young people initiating benzodiazepine treatment (14 444 female participants [62.6%]; mean [SD] age, 23 [4.1] years) and 66 706 initiating a comparator treatment (38 446 female participants [57.6%]; mean [SD] age, 22 [4.4] years). Six months after treatment initiation, 9.7% (95% CI, 9.3%-10.1%) of benzodiazepine users and 12.3% (95% CI, 12.1%-12.6%) of the comparator group were still receiving treatment. The crude incidence of drug overdose at 6 months was 0.9% for benzodiazepine initiators and 0.8% for comparator treatment initiators. In adjusted analyses, an increased risk of drug overdose was associated with benzodiazepines vs comparator treatments (intention-to-treat analysis: HR, 1.25 [95% CI, 1.03-1.51]; as-treated analysis: HR, 1.44 [95% CI, 1.14-1.80]). This association was stronger among young people with a recent prescription opioid fill vs those without a recent prescription opioid fill (as-treated analysis: adjusted HR, 2.01 [95% CI, 1.24-3.25] vs adjusted HR, 1.31 [95% CI, 1.00-1.70]). The findings of this study suggest that benzodiazepines, compared with alternative pharmacologic treatments for common sleep disorders, were associated with an increased risk of drug overdose among young people during the following 6-month period, especially among those with a recent opioid prescription. Drug overdose is an important safety consideration when treating young people with benzodiazepines.