The coronavirus disease 2019 (COVID-19) pandemic has been going on around the world for more than a year and has cost a lot, as well as affected the quality of life of many. The psychological stress like delirium and sleep disturbances caused by the COVID-19 has affected many people in direct or indirect way by the disease. Insomnia and sleep deprivation have a negative effect on the immune system as well as disorders of the hormonal system, including the production and secretion of melatonin, known as the sleep hormone. Melatonin is a known anti-inflammatory and antioxidant agent in addition to its role in regulating circadian rhythms. In this review, we investigated the relationship between the effect of psychological stress caused by COVID-19 on patients, their families, health care workers, and occupations as well as how melatonin might act as a prophylactic agent with sedative effects and sleep enhancement potential. Search terms "melatonin" and "COVID-19" were manually searched on PubMed or other electronic database and relevant articles were included. Based on the review of scholarly articles, it can be inferred that melatonin, as an endogenous hormone controlling and regulating sleep and wakefulness in various researches, has a good potential due to its antioxidant and anti-inflammatory with minimal side effects. These beneficial effects highlight the impact of melatonin as an adjuvant and a potential alternative for the better management of SARS-CoV-2 infection in high-risk populations.