Insomnia may predict onset of mental disorders in adults. However, it is unclear whether the same directional relationship exists during the peak age range for the onset of major mental disorders and/or whether other types of sleep-wake disturbance, such as hypersomnia, show similar associations. Longitudinal follow-up of >1800 community residing twins and non-twin siblings (mean age ~26; 57% female). Adjusted relative risk ratios and 95% confidence intervals (Adj RR and 95% CI) were estimated for onset of depression, hypomania and psychosis in individuals with prior self-reported exposure to Insomnia and/or Hypersomnia or proxies for insomnia disorder (Insomnia and Daytime Impairment) and atypical symptom profile (Hypersomnia and Anergia). Risk of onset differed somewhat according to type of syndrome and the nature of sleep-wake disturbance (e.g. Insomnia alone increased risk of first onset of psychosis). Overall, the risk for onset of any syndrome was best identified using composite measures (Adj RR were ~1.5-2.5) such as Insomnia and Hypersomnia, Insomnia and Daytime Impairment, or Hypersomnia and Anergia, rather than singular items describing night-time disruption only. The magnitude of risk of onset of major mental health problems and the availability of effective, low-cost, individual and population-based interventions for sleep-wake disturbances, suggest that it is justifiable to introduce screening for and strategies to overcome sleep problems in youth. Copyright © 2020. Published by Elsevier B.V.