From the Guidelines

Melatonin's effectiveness as a sleep aid is not supported by sufficient evidence, according to the most recent and highest quality studies 1.

The American College of Physicians' clinical practice guideline found insufficient evidence to support the use of melatonin for chronic insomnia disorder in adults 1.
A systematic review of pharmacologic treatments for insomnia disorder also found insufficient evidence to support the use of melatonin 1.
Another study found that the evidence for melatonin's effectiveness in treating insomnia disorder was limited, and its use was not recommended due to the lack of strong evidence 1.

Cognitive behavioral therapy for insomnia (CBT-I) is a recommended treatment for chronic insomnia disorder, as it has been shown to be effective in improving sleep outcomes and has fewer harms compared to pharmacologic treatments 1.
When considering pharmacologic treatments, eszopiclone, zolpidem, and suvorexant may improve short-term global and sleep outcomes for adults with insomnia disorder, but their comparative effectiveness and long-term efficacy are not well established 1.

Given the lack of sufficient evidence, melatonin should not be recommended as a first-line treatment for insomnia disorder.
CBT-I should be considered as a first-line treatment for chronic insomnia disorder, due to its effectiveness and safety profile.
If pharmacologic treatments are considered, eszopiclone, zolpidem, and suvorexant may be options, but their use should be carefully evaluated and monitored due to potential harms and limited evidence on long-term efficacy.

From the Research

Melatonin has been shown to synchronize the circadian rhythms, and improve the onset, duration and quality of sleep 2.
It is centrally involved in anti-oxidation, circadian rhythmicity maintenance, sleep regulation and neuronal survival 2.
Melatonin offers an alternative treatment to the currently available pharmaceutical therapies for sleep disorders with significantly less side effects 2.
Melatonin and ramelteon may be considered as treatment options for insomnia, although more research is needed to determine their efficacy 3, 4.
Melatonin has a small impact on sleep latency and can produce residual sedation, but it is considered a safer option compared to benzodiazepines and non-benzodiazepine receptor agonists 5.
Melatonin and the melatonin-receptor agonist ramelteon have not had adequate study in psychiatric patients to define their use, but small studies suggest benefit 6.

Benzodiazepines and non-benzodiazepine receptor agonists have the potential to induce addiction, cause withdrawal symptoms, or trigger rebound insomnia 2, 4, 5.
Sedating antidepressants, such as mirtazapine, nefazodone, or tricyclic antidepressants, are preferred for their sedative effects, but often have limited usefulness due to side effects 6.
Ramelteon has a minimal adverse effect profile and is effective for sleep-onset latency and increased total sleep time, making it a valuable first-line option 5.

More research is needed to determine the efficacy of melatonin and ramelteon for the treatment of insomnia 4.
The data on melatonin are based on studies with multiple limitations, and only three controlled trials have been done with ramelteon 4.
Further studies are needed to define the use of melatonin and ramelteon in psychiatric patients 6.