Introduction Insomnia is a prevalent sleep disorder that can profoundly impact a person's physical health and mental wellbeing. Most of the currently available drugs for insomnia exert adverse effects. Hence, alternative herbal therapies could be effective in treating insomnia. Ashwagandha, a proven "Rasayana" from ancient Ayurveda is having the required potential to treat insomnia. Objective To determine the efficacy and safety of Ashwagandha root extract in patients with insomnia and anxiety. Methods This was a randomized, double-blind, placebo-controlled study conducted at Prakruti Hospital, Kalwa, Maharashtra, India. A total of 60 patients were randomly divided into two groups: test (n = 40) and placebo (n = 20) in a randomization ratio of 2:1. Test product was a capsule containing highest concentration full-spectrum Ashwagandha root extract 300 mg, and the placebo was an identical capsule containing starch. Both treatments were given twice daily with milk or water for 10 weeks. Sleep actigraphy (Respironics Philips) was used for assessment of sleep onset latency (SOL), total sleep time (TST), sleep efficiency (SE) and wake after sleep onset (WASO). Other assessments were total time in bed (sleep log), mental alertness on rising, sleep quality, Pittsburgh Sleep Quality Index (PSQI), and Hamilton Anxiety Rating Scale (HAM-A) scales. Results Two patients, one from each group, did not complete study and the per-protocol dataset (n = 58) included 29 and 19 patients from test and placebo, respectively. The baseline parameters were similar in the two groups at baseline. The sleep onset latency was improved in both test and placebo at five and 10 weeks. However, the SOL was significantly shorter (p, 0.019) after 10 weeks with test [29.00 (7.14)] compared to placebo [33.94 (7.65)]. Also, significant improvement in SE scores was observed with Ashwagandha which was 75.63 (2.70) for test at the baseline and increased to 83.48 (2.83) after 10 weeks, whereas for placebo the SE scores changed from 75.14 (3.73) at baseline to 79.68 (3.59) after 10 weeks. Similarly, significant improvement in sleep quality was observed with test compared to placebo (p, 0.002). Significant improvement was observed in all other sleep parameters, i.e., SOL, SE, PSQI and anxiety (HAM-A scores) with Ashwagandha root extract treatment for 10 weeks. Conclusion Ashwagandha root extract is a natural compound with sleep-inducing potential, well tolerated and improves sleep quality and sleep onset latency in patients with insomnia at a dose of 300 mg extract twice daily. It could be of potential use to improve sleep parameters in patients with insomnia and anxiety, but need further large-scale studies.