In the context of sleep physiology, the SCN is crucial for determining when we feel alert and when we feel sleepy. It influences the production of melatonin, a hormone produced by the pineal gland that promotes sleep. During the evening, the SCN signals the pineal gland to start melatonin production, preparing the body for sleep. Conversely, in the morning, light exposure inhibits melatonin production, promoting wakefulness.