The locus coeruleus (LC) is the primary source of norepinephrine (NE) in the brain, and the LC-NE system is involved in regulating arousal and sleep. It plays key roles in the transition between sleep and wakefulness, and between slow wave sleep (SWS) and rapid eye movement sleep (REMS). However, it is not clear whether the LC activity during the day predicts sleep quality and sleep properties during the night, and how this varies as a function of age. Here, we used 7 Tesla functional Magnetic Resonance Imaging (7T fMRI), sleep electroencephalography (EEG) and a sleep questionnaire to test whether the LC activity during wakefulness was associated with sleep quality in 52 healthy younger (N=33; ~22y; 28 women) and older (N=19; ~61y; 14 women) individuals. We find that, in older, but not in younger participants, higher LC activity, as probed during an auditory mismatch negativity task, is associated with worse subjective sleep quality and with lower power over the EEG theta band during REMS (4-8Hz), which are two sleep parameters significantly correlated in our sample of older individuals. The results remain robust even when accounting for the age-related changes in the integrity of the LC. These findings suggest that the activity of the LC may contribute to the perception of the sleep quality and to an essential oscillatory mode of REMS, and that the LC may be an important target in the treatment of sleep disorders and age-related diseases.