Attitudes and expectations of people towards their lives are essential to future health outcomes. Growing evidence has linked dispositional optimism to beneficial health outcomes, such as exceptional longevity, healthy aging and better sleep quality. We describe the association between dispositional optimism and chronic insomnia, considering potential mediators, in the Austrian Sleep Survey (N = 1,004), a population-based cross-sectional study conducted in 2017. Optimism was measured using the validated Life Orientation Test-Revised, and four different definitions were used to assess chronic insomnia. Three definitions were based on the criteria of chronic insomnia according to the International Classification of Sleep Disorders (3rd edn). Age- and multivariable-adjusted logistic regression models were used to calculate odds ratios (OR) and 95% confidence intervals (CIs). Among Austrians who were more optimistic, chronic insomnia risk was lower compared with those less optimistic (middle versus bottom tertile of optimism score: OR = 0.39, 95% CI, 0.22-0.70; and top versus bottom tertile: OR = 0.28, 95% CI, 0.14-0.54;p-trend < .001). Results were similar for all four definitions of insomnia, and differed slightly between men and women. Happiness, depression and health status confounded the association, whereas lifestyle did not. Promoting dispositional optimism could represent a simple and accessible strategy to improve sleep quality and lower insomnia risk, with downstream beneficial health effects. Further research is needed to clarify the prevention potential of interventions targeting this mental trait.