First generation H1-antihistamines (such as diphenhydramine = Benadryl) are well known for their sedative effects explaining their limited use in patients with allergic rhinitis. Several pharmacological studies have shown that diphenhydramine crosses the blood brain barrier and produces CNS sedation.
Two studies have (partly) addressed your question regarding the loss in sedation efficacy over time. Both studies focused on daytime sleepiness (as this one of the side effects which prevents prescription of diphenhydramine in patients with allergic rhinitis) but the mechanisms of tolerance can probably be extended to diphenhydramine use against insomnia.
- In the first study, participants receiving dimenhydrinate (an
ethanolamine antihistamine that is metabolized to diphenhydramine and
chlorotheophylline) were asked to assess their sleepiness while in
parallel, psychomotor performance tests where conducted. Results
showed a modest attenuation of subjective sedation and performance
impairment after successive doses during a single day of drug
exposure.
- In the second study authors conducted a randomised double blind
placebo controlled crossover study in 15 individuals. Here again, a
tolerance to the drug was observed: sedative effects which were
evident on the first day became indistinguishable from placebo by the
end of 3 days of treatment.
Three possible mechanisms for the tolerance to diphenhydramine were suggested in the literature: behavioural adaptation (only if diphenhydramine was taken during the day for allergic rhinitis); (2) altered drug metabolism, e.g., increased clearance; or (3) altered neuropharmacological effect.
So according to current knowledge, there is evidence for tolerance of diphenhydramine over time.
Sources:
- Richardson G et al. Tolerance to Daytime Sedative Effects of H1
Antihistamines. Journal of Clinical Psychopharmacology.
22(5):511-515, October 2002.
- Manning C et al. Central nervous system effects of meclizine and
dimenhydrinate: evidence of acute tolerance to antihistamines. J Clin
Pharmacol 1992; 32:996–1002.