they should really think carefully before making a decision. This is used when someone has a big and important decision in life to make. The idea is that you should go to sleep and make a final decision the next day so you don't make an emotional decision.
Here is an example of how to use this:
Tom: I'm thinking about buying a new Ipad but it's kind of expensive and I'm not really sure if I really need it or not. Do you think I should get one?
Riley: I think you should sleep on it. If you still want one tomorrow morning then just buy it.