The consolidation of memory is thought to be a time-dependent process by which labile memories are strengthened and made resistant to interference and decay.  Sleep has been found to consolidate rote memory, both procedural and declarative.  Although rote memory is important for learning, the ability to generalize is a key feature of adaptive behavior and is essential for the survival of complex organisms.  Here we show a role of sleep in the consolidation of generalized procedural learning.  Typically, performance improves after training, but then degrades over the course of a waking day.  However, after a period of sleep, learning is restored.  Furthermore, a period of sleep inoculates the memory against degradation during a subsequent waking interval.  If sleep plays a functionally similar role in the consolidation of procedural and declarative memory, we may expect greater generalization of learned declarative information after sleep. To investigate this, we used a paradigm that is known to elicit high rates of false or illusory memory.  Greater generalization may result in higher false memory rates after sleep.  However, rather than promoting false memory, sleep actually reduces false memory without sacrificing correct memory.  This research suggests that consolidation effects in generalized skills are functionally distinct from effects found in rote procedural memory and that sleep does not increase generalization in an illusory memory task, but instead improves the accuracy of memory through a reduction of false memory.