The songs which comprise Sleepless Nights were collected from two sources. In early 1970, the Flying Burrito Brothers, featuring Parsons, recorded several songs for an anticipated no-nonsense country album.  The album was ultimately never released due to Parsons’ departure from the band. Nine of Sleepless Nights’ tracks come from these sessions. The remaining three songs are from the summer 1973 sessions for Grievous Angel, Parsons’ final solo album, and feature duets with Emmylou Harris on the Everly Brothers' song "Brand New Heartache," the gospel-etched "The Angels Rejoiced Last Night", and Boudleaux Bryant's achingly lovely "Sleepless Nights".
The album has received mixed reviews. Robert Christgau noted that the songs “were outtakes for a reason”, but nonetheless gave the album a favorable B- rating.  Some of the highest praise for the album is due to the inclusion of the three tracks featuring Harris and omitted from the 1973 album Grievous Angel; "Sleepless Nights" (allegedly the original title for the Grievous Angel album), "The Angels Rejoiced in Heaven Last Night" and "Brand New Heartache".Rolling Stone has referred to the album as "sluggish and dispirited", due in large part to Parson's impending departure from the group which lingered over the recording sessions.