Background: Prolonged disruption of sleep in animal studies is associated with decreased neurogenesis in the dentate gyrus. Our objective was to determine whether insomnia severity in a sample of posttraumatic stress disorder (PTSD) patients and control subjects was associated with decreased volume in the CA3/dentate hippocampal subfield. Methods: Volumes of hippocampal subfields in 17 veteran men positive for PTSD (41 ± 12 years) and 19 age-matched male veterans negative for PTSD were measured with 4-T magnetic resonance imaging. Subjective sleep quality was measured by the Insomnia Severity Index (ISI) and the Pittsburgh Sleep Quality Index. Results: Higher scores on the ISI, indicating worse insomnia, were associated with smaller volumes of the CA3/dentate subfields (r = -.48, p < .01) in the combined sample. Adding the ISI score as a predictor for CA3/dentate volume to a hierarchical linear regression model after first controlling for age and PTSD symptoms accounted for a 13% increase in incremental variance (t = -2.47, p = .02). Conclusions: The findings indicate for the first time in humans that insomnia severity is associated with volume loss of the CA3/dentate subfields. This is consistent with animal studies showing that chronic sleep disruption is associated with decreased neurogenesis and dendritic branching in these structures. © 2010 Society of Biological Psychiatry.