Melatonin: Much More Than You Wanted to Know
slatestarcodex.com
slatestarcodex.com
I tried a 5mg pill once, and felt really awful the next day. Just like any drug, start with small doses.
I've also read how it's possible to develop a dependency if you take it too often. Your body becomes used to the supplement, and natural production is reduced.
That Sleep book by Matthew Walker has a good explanation of how sleep-related hormones (including melatonin) and such work -- and how to get better and longer sleep.
More seriously though, the melatonin article was useful to me as we decided we were using melatonin incorrectly with our dog to reduce early morning barking (too high a dose even though it was what it the bottle advised, too early) -- and so we stopped giving it to her entirely.
Scared me off of the stuff for good. Thankfully, over time I've gotten to where I don't have sleep issues anymore other than those I self-inflict (late nights). I still wonder if somehow I really psyched myself into a placebo effect or something, because I rarely hear of this happening when people take it.
MIT has done some studies that show smaller doses are in-fact just as (or more) effective than larger ones: http://news.mit.edu/1999/melatonin-1103
And studies mentioned in this article seem to agree with that conclusion (0.3mg being an optimal dose)