Even though you may have heard a hypnotist say the word "Sleep" to induce the hypnotic trance, the state of hypnosis is not quite the same as sleeping. Hypnosis is most similar to the state you are in right before you wake up, and right before you fall asleep. This is also a good describtion of what hypnosis feels like. If someone were to talk to you right before you fall asleep you will probably be aware of it, and be able to respond to it.

When I was younger my need for sleep was quite big, and sometimes my mother would come into my room and talk to me about things I should do for her. Later that day I would have the feeling that I had talked to my mother but that I didn't know what we had talked about. To find out what she had said I would call her up at work and ask her if she had said anything to me. Everytime this happened she thought I would remember because I responded to what she said.

I'm quite sure that most people has had similar experiences right before they are awake or before they fall asleep. I have had one experience of catalepsy, where I felt awake but wasn't able to move my legs or arms. This is also described in the literature of hypnosis to be a hypnotic phenomena. To sum up hypnosis is a state of focused concentration, that is very similar to the state you're in right before you wake up or fall asleep.