This study examined the accuracy of insomnia patients and their treating physicians in rating whether an active hypnotic drug or a placebo was given in treatment. Forty older adults with primary insomnia were randomly assigned to either an active (temazepam) or a placebo condition using a double-blind strategy. Ratings of treatment conditions were obtained at 1 week (early treatment), 4 weeks (midtreatment), and 8 weeks (late treatment). Patients were able to accurately discriminate (beyond chance levels) between the active and placebo medications at the early (76.9% accuracy) and late treatment assessment timepoints (78.1% accuracy), but not at midtreatment (51.5% accuracy). Therapists, however, were able to make accurate discriminations at the late treatment assessment timepoint only (80% accuracy); early (69.2% accuracy) and midtreatment (47.2% accuracy) ratings did not exceed chance levels. Patients who had used hypnotic drugs prior to this trial were more accurate in their judgments of treatment conditions than those without prior exposure. The findings raise an important issue about the internal validity of the double-blind strategy, which may in fact be only a single-blind procedure.