Abstract： Objective： To observe the clinical effect of modified Wendan Decoction combined with Chaihu Shugan Powder for menopause insomnia (MI). Methods： A total of 80 cases of MI patients were divided into the control group and the observation group according to the random number table method， with 40 cases in each group. The control group was treated with Estazolam Tablets，and the observation group was additionally treated with modified Wendan Decoction combined with Chaihu Shugan Powder based on the treatment of the control group. The scores of Pittsburgh Sleep Quality Index (PSQI)，traditional Chinese medicine (TCM) syndrome scores， and follicle stimulating hormone (FSH)， estradiol (E2)， and luteinizing hormone (LH) in serum were compared between the two groups. Clinical effects and the incidence of adverse reactions were evaluated in the two groups. Results： After treatment， the total effective rate in the observation group was higer than that in the control group (P＜0.05). After treatment， the PSQI scores，TCM syndrome scores，and the levels of FSH and LH in serum in the two groups were significantly decreased when compared with those before treatment (P＜0.05)，and the levels of E2 were increased (P＜0.05)；the PSQI scores，TCM syndrome scores，and the levels of FSH and LH in serum in the observation group were lower than those in the control group (P＜0.05)， and the E2 level was higher than that in the control group (P＜0.05). There was no significant difference being found in the comparison of the incidence of adverse reactions (P＞0.05). Conclusion： Modified Wendan Decoction combined with Chaihu Shugan Powder has a definite curative effect in the treatment of MI，and can significantly improve the sleep quality of patients and regulate sex hormone levels with high safety.