Astrocytes are known to release several transmitters to impact neuronal activity. Cell-specific molecular genetic attenuation of vesicular release has shown that ATP is a primary astrocytic transmitter in situ and in vivo. In this review, we discuss the biology of astrocytic ATP release highlighting the exciting discovery that lysosomes might be primary stores for the release of this gliotransmitter. In addition, we discuss the role of ATP and its metabolite adenosine on synaptic transmission and the coordination of synaptic networks. Finally, we discuss the recent elucidation of the involvement of this form of glial signaling in the modulation of mammalian behavior. By controlling neuronal A1-receptor signaling, astrocytes modulate mammalian sleep homeostasis and are essential for mediating the cognitive consequences of sleep deprivation. These discoveries begin to paint a new picture of brain function in which slow-signaling glia modulate fast synaptic transmission and neuronal firing to impact behavioral output. Because these cells have privileged access to synapses, they may be valuable targets for the development of novel therapies for many neurological and psychiatric conditions.