Background: This study was conducted to determine the effect of lavender oil on sleep quality and vital signs in palliative care patients. Methods: We examined 68 patients in a palliative care unit. Vital signs of all the patients were assessed, and also their sleep quality was evaluated using the Richards-Campbell Sleep Questionnaire. Lavender was applied to patients in the experimental group. During the intervention, vital signs of the patients were monitored at 4-h intervals throughout the night, and sleep quality was evaluated during the morning. The same evaluation processes were performed for the control group. Results: It was observed in the evaluation that lavender application did not affect the vital signs of the patients but it ensured a deeper sleep on the 2nd day after the intervention, facilitated their falling asleep and sleeping again when they were awakened and enhanced sleep quality (p < 0.05). Also, this application decreased the awakening frequency on the 1st and 2nd days and enhanced overall sleep quality (p < 0.05) after the intervention. Conclusions: Lavender has no effect on the vital signs of palliative care patients but is an effective and reliable approach to enhance their sleep quality.