Bedbugs are increasingly a problem in the United States. According to the University of Kentucky Entomology Department, this could be due to increased immigration and worldwide travel, as well as the banning of many effective pest-control chemicals, like DDT.
People concerned about carcinogens and other harmful chemical effects linked to traditional pesticides have focused on tea tree oil as a solution to a wide range of problems, including bedbug infestations.
Tea tree oil is made by using a steam process to distill the leaves of the Melaleuca alternifolia plant, which is native to Australia. While the leaves do contain terpenoids, which have proven antifungal and antiseptic properties, there is no evidence to support the claim that the essential oil contains anything useful as a pesticide.
Bedbugs are little brown insects--usually only 0.2 inches long--that feed on blood. When they bite you, they release a natural anesthetic so that you won't feel the bite, along with an anticoagulant that keeps your blood from clotting so that they can feed more easily.
Bedbugs do not pass any diseases to people beings, but it is possible that they carry the organisms that cause Chagas disease and hepatitus B, according to the Mayo Clinic.
If you wake up itchy and covered with small bite marks, you probably have bedbugs. It's best to be sure, though, since fleas can cause the same symptoms. A careful search of your mattress, bedclothes and the area surrounding your bed will confirm: you've got bedbugs if you find live, crawling bugs along with small bloodstains, dried husks and bug feces. The links below have good photos of all of these.
Advocates of tea tree oil say you should purchase it in a concentrated form, dilute it with water and spray it all over your mattress and under your bed. There is no specific formula for diluting the essential oil.
Undiluted tea tree oil coming into contact with your skin can lead to redness, swelling, itching and blistering. It absolutely should not be ingested because it can cause diarrhea, a potentially compromised immune system, confusion and drowsiness so extreme it can lead to coma.
There is no evidence--other than anecdotal--to suggest that tea tree oil has any effect on bedbugs. Undiluted, it will kill them, but it is not safe to use undiluted tea tree oil where you sleep. Diluted tea tree oil has not been proven to have any effect on bedbugs other than possibly making them smell better.
The main reason to use tea tree oil in trying to eliminate bedbugs is that it is non-toxic when properly diluted, inexpensive and smells good.
The best reason not to use tea tree oil to kill bedbugs is that it doesn't work.