i-adjective
unable to sleep well; difficult to sleep
Describes conditions that make sleeping uncomfortable, such as heat, humidity, noise, or worry. Often used with 夜 or 暑さ.
暑くて寝苦しい夜が続いている。
We've been having hot, sleepless nights.
隣の騒音で寝苦しかった。
I couldn't sleep well because of the noise next door.
眠れない simply means 'cannot sleep' and can refer to insomnia or any cause. 寝苦しい emphasizes discomfort during sleep, often due to external conditions.
Compound of 寝 (ne, 'sleep') + 苦しい (kurushii, 'painful, difficult'). The reading ねぐるしい reflects rendaku voicing of く to ぐ.