Since Cannon first formulated the concept of homeostasis 60 years ago, attention has been focused on the corrective responses initiated after the steady state of the organism is perturbed. In this lecture it is argued that the concept of homeostasis should be extended to include the precisely timed mechanisms of the circadian (and circannual) timing system which enables organisms to predict when environmental challenges are most likely to occur. A mature understanding of homeostasis should encompass both "reactive" responses to changes in physiological variables which have already occurred and the "predictive" responses initiated in anticipation of predictably timed challenges. Such predictive responses have particular value because they enable physiological mechanisms to be utilized immediately, even if they involve a delay of several hours, by activating them at a suitable time in advance of a probable challenge. However, conflicts may often occur between predictions and reality. Examples from sleep-wake behavior, thermoregulation, blood volume homeostasis, and the regulation of potassium balance show that predictive responses often compromise the effectiveness of reactive homeostatic mechanisms even to the point of risking the survival of the organism. It must be concluded that the day-night cycle of the natural environment has played a fundamental role in shaping the evolutionary development of homeostatic mechanisms because of the dominating predictability of diurnal changes in illumination, temperature, food availability, and predator activity.