This study found that subjects sleeping 8.5-hrs per night lost more fat than subjects sleeping 5.5-hrs per night during a 2-week restricted diet. Both groups lost the same amount of weight, but the 8.5-hr/night group lost significantly more weight as fat. If you’re trying to cut body fat, mild sleep deprivation can impair your progress and can even cause muscle loss.
Reference: Nedeltcheva, A. V., Kilkus, J. M., Imperial, J., Schoeller, D. A., & Penev, P. D. (2010). Insufficient sleep undermines dietary efforts to reduce adiposity. Annals of Internal Medicine, 153(7), 435-441.