The basal forebrain helps in the formation and storage of new memories and also regulates the sleep cycle. Damage to this area can produce amnesia and insomnia.
Stimulation of the basal forebrain causes certain cells within it to fire, which produces non-rapid eye movement sleep, or dreamless sleep. Rising and falling nitric oxide levels in this region trigger sleep and wakefulness, respectively.
The characteristic amnesia caused by damage to the basal forebrain is anterograde amnesia. People with this condition can remember events from the past clearly, but cannot recall anything in between the present and the moment when they acquired their brain damage. They can gain skills taught to them after the acquired brain damage, but do not remember learning them.