Pregnant women with insomnia are at elevated risk for depression, anxiety, and suicidality. Heightened cognitive arousal (e.g., perseverating about pregnancy- and baby-related concerns and other general sources of stress) plays a central role in linking insomnia with mental health symptoms during peripartum. Prospective data depict a toxic cycle wherein perseverative thinking at night disrupts sleep, which, in turn, leads to greater nighttime perseverative thinking, and so on. This cycle may fuel perinatal depression, anxiety, and suicidal thoughts. Emerging clinical findings show that insomnia therapy not only improves sleep quality in pregnancy but can benefit comorbid mental health symptoms. Moreover, improving sleep quality may even prevent the development of new-onset depression and anxiety in the perinatal period. Future direction should focus on tailoring insomnia therapeutics to the perinatal experience and guiding how to best implement these services into real-world healthcare settings.