Is it obligatory to stay awake all night on Laylat al-Qadr?

It is recommended to spend Laylat al-Qadr in as much worship as possible. However, it is not a condition to stay awake the entire night. This is because Aisha (may Allah be pleased with her) said:

ولا قام ليلة حتى أصبح

“(The Messenger of Allah) never spent the whole night in prayer until morning.” [1]

The Prophet (peace and blessings be upon him) also said in another hadith:

إن هذا الشهر قد حضركم، وفيه ليلة خير من ألف شهر، من حرمها فقد حرم الخير كله، ولا يحرم خيرها إلا محروم

“This month has come to you. In it is a night better than a thousand months. Whoever is deprived of its goodness is truly deprived of all good, and only the truly deprived are kept from its goodness.” [2]

Therefore, a Muslim should strive to spend this night in worship and not miss out on its rewards. If one becomes tired, it is permissible to rest for a while and then continue worship afterwards.

From the book "Fatwas Regarding Ramadan Fasting"

[1] Imam al-Nasa'i, No. 2347.

[2] Ibn Majah, No. 1649.