Loneliness Matters: A Theoretical and Empirical Review of Consequences and Mechanisms https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3874845/ General info:
As a social species, humans rely on a safe, secure social surround to survive and thrive. Perceptions of social isolation, or loneliness, increase vigilance for threat and heighten feelings of vulnerability while also raising the desire to reconnect. Implicit hypervigilance for social threat alters psychological processes that influence physiological functioning, diminish sleep quality, and increase morbidity and mortality. [...] Loneliness is not simply being alone. Interventions to reduce loneliness and its health consequences may need to take into account its attentional, confirmatory, and memorial biases as well as its social and behavioral effects. [...] Loneliness is a common experience; as many as 80% of those under 18 years of age and 40% of adults over 65 years of age report being lonely at least sometimes [1–3], with levels of loneliness gradually diminishing through the middle adult years, and then increasing in old age (i.e., ≥70 years) . Loneliness is synonymous with perceived social isolation, not with objective social isolation. [...] For as many as 15–30% of the general population, however, loneliness is a chronic state [10, 11]. Left untended, loneliness has serious consequences for cognition, emotion, behavior, and health. [...]
Effects on mental health:
Loneliness has been associated with personality disorders and psychoses [23–25], suicide , impaired cognitive performance and cognitive decline over time [27–29], increased risk of Alzheimer’s Disease , diminished executive control [30, 31], and increases in depressive symptoms [32–35]. The causal nature of the association between loneliness and depressive symptoms appears to be reciprocal , but more recent analyses of five consecutive annual assessments of loneliness and depressive symptoms have shown that loneliness predicts increases in depressive symptoms over 1-year intervals, but depressive symptoms do not predict increases in loneliness over those same intervals . In addition, experimental evidence, in which feelings of loneliness (and social connectedness) were hypnotically induced, indicates that loneliness not only increases depressive symptoms but also increases perceived stress, fear of negative evaluation, anxiety, and anger, and diminishes optimism and self-esteem . These data suggest that a perceived sense of social connectedness serves as a scaffold for the self—damage the scaffold and the rest of the self begins to crumble. [...] Our model of loneliness [8, 9] posits that perceived social isolation is tantamount to feeling unsafe, and this sets off implicit hypervigilance for (additional) social threat in the environment. Unconscious surveillance for social threat produces cognitive biases: relative to nonlonely people, lonely individuals see the social world as a more threatening place, expect more negative social interactions, and remember more negative social information. Negative social expectations tend to elicit behaviors from others that confirm the lonely persons’ expectations, thereby setting in motion a self-fulfilling prophecy in which lonely people actively distance themselves from would-be social partners even as they believe that the cause of the social distance is attributable to others and is beyond their own control . This self-reinforcing loneliness loop is accompanied by feelings of hostility, stress, pessimism, anxiety, and low self-esteem  and represents a dispositional tendency that activates neurobiological and behavioral mechanisms that contribute to adverse health outcomes. [...]
Effects on sleep and functioning:
Indeed, loneliness and poor quality social relationships have been associated with self-reported poor sleep quality and daytime dysfunction (i.e., low energy, fatigue), but not with sleep duration [49–52]. In young adults, greater daytime dysfunction, a marker of poor sleep quality, was accompanied by more nightly micro-awakenings, an objective index of sleep continuity obtained from Sleep-Caps worn by participants during one night in the hospital and seven nights in their own beds at home . The conjunction of daytime dysfunction and micro-awakenings is consistent with polysomnography studies showing a conjunction, essentially an equivalence, between subjective sleep quality and sleep continuity , and substantiates the hypothesis that loneliness impairs sleep quality. [...] Cross-lagged panel analyses of the three consecutive days indicated potentially reciprocal causal roles for loneliness and daytime dysfunction: lonely feelings predicted daytime dysfunction the following day, and daytime dysfunction exerted a small but significant effect on lonely feelings the following day , effects that were independent of sleep duration. [...] [...]
Accordingly, we posited that interventions that targeted maladaptive social cognition (e.g., cognitive behavioral therapy that involved training to identify automatic negative thoughts and look for disconfirming evidence, to decrease biased cognitions, and/or to reframe perceptions of loneliness and personal control) would be more effective than interventions that targeted social support, social skills, or social access. Moderational analyses of the randomized group comparison studies supported our hypothesis: the effect size for social cognition interventions (−0.60, 95% CI −0.96, −0.23, N= 4) was significantly larger than the effect size for social support (−0.16, 95% CI −0.27, −0.06, N=12), social skills (0.02, 95% CI −0.24, 0.28, N=2), and social access (−0.06, 95% CI −0.35, 0.22, N=2); [...] A social cognitive approach to loneliness reduction outlined in a recent book  may encourage therapists to develop a treatment that focuses on the specific affective, cognitive, and behavioral propensities that afflict lonely individuals. [...] (  Loneliness: Human Nature and the Need for Social Connection http://libgen.rs/search.php?req=Loneliness%3A+Human+Nature+and+the+Need+for+Social+Connection )
My tl;dr: Subjective(rather than objective) social isolation impairs sleep quality, immune function, executive control, drives cognitive decline, and elicits a state of hypervigilance to social threat and maladaptive changes in cognition that further drive isolation and lead lonely people to see the world as a worse place. Most effective interventions appear to be ones that address the cognitive alterations, rather than ones that provide social opportunity or skills. Humans are intrinsically social animals that are not capable of being well alone.