A precise balance between sleep and wakefulness is essential to sustain a good quality of life and optimal brain function. GABA is known to play a key and conserved role in sleep control, and GABAergic tone should, therefore, be tightly controlled in sleep circuits. Here, we examined the role of the astrocytic GABA transporter (GAT) in sleep regulation using Drosophila melanogaster. We found that a hypomorphic gat mutation (gat(33-1)) increased sleep amount, decreased sleep latency, and increased sleep consolidation at night. Interestingly, sleep defects were suppressed when gat(33-1) was combined with a mutation disrupting wide-awake (wake), a gene that regulates the cell-surface levels of the GABAA receptor resistance to dieldrin (RDL) in the wake-promoting large ventral lateral neurons (l-LNvs). Moreover, RNAi knockdown of rdl and its modulators dnlg4 and wake in these circadian neurons also suppressed gat(33-1) sleep phenotypes. Brain immunohistochemistry showed that GAT-expressing astrocytes were located near RDL-positive l-LNv cell bodies and dendritic processes. We concluded that astrocytic GAT decreases GABAergic tone and RDL activation in arousal-promoting LNvs, thus determining proper sleep amount and quality in Drosophila.