Study objectives: Our goal was to compare brief behavioral treatment for insomnia (BBTI) to a progressive muscle relaxation training (PMRT) control condition among veterans with insomnia, examining psychosocial functioning as a primary outcome and sleep-related outcomes, mood, cognition, and pain as secondary outcomes. Methods: Veterans were randomly assigned to either BBTI or PMRT (N = 91; 24-74 years; M = 49 years). BBTI consisted of two in-person (60-min and 30-min sessions) and two telephone sessions (20-min each), and the PMRT control condition was matched to BBTI for session duration and type. Veterans were assessed through clinical interview at baseline and self-report measures at pre-, mid-, and posttreatment, as well as 6-month follow-up for the BBTI condition to assess sustained response. Measures also included continuous sleep monitoring with sleep diary. Results: Intent-to-treat analyses demonstrated that individuals who completed BBTI versus PMRT reported greater improvements in work, home, social and cognitive functioning, insomnia symptom severity, mood, and energy. Improvements in psychosocial functioning, insomnia symptoms, and mood were maintained 6-months following BBTI treatment completion. Conclusions: Veterans who received BBTI improved and maintained gains in psychosocial functioning, insomnia, and mood. BBTI is a treatment that can be implemented in primary care, mental health, or integrated care settings and provide symptom relief and improved functioning among those with insomnia, one of the most commonly reported mental health problems among veterans.