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The wielder cannot be put to sleep. Rest will fail when used by the wielder. If the wielder is sleeping, it is instantly cured of sleep. A Pokemon with Mold Breaker can target the wielder with Yawn and make it drowsy, but the wielder will fail to fall asleep (unless it no longer has Vital Spirit the next turn).
Outside of battle, if the wielder of Vital Spirit is leading the party, then Vital Spirit increases the chance to encounter a higher-level wild Pokemon by 50%.
Up to DPP, the only fully evolved Pokemon with access to Vital Spirit were Delibird (which is absolutely useless) and Primeape. In the latter's case, it was the better option over the unreliable Anger Point.
With the advent of the Dream World, Magmortar and Electivire received Vital Spirit, and Primeape, Defiant. Electivire will still use the much better Motor Drive, but Magmortar can take advantage of being able to switch in a sleep-inducing move and fire off powerful attacks. In Primeape's case, Defiant can be a tempting option, but frail as it is, it will appreciate being able to switch in more often.
Found in Dream World