Yes, it will throw an exception. According to the javadoc for Thread.sleep, the method:
Throws:
InterruptedException - if any thread has interrupted the current thread. The interrupted status of the current thread is cleared when this exception is thrown.
The 'has' in this case is an informal way of referring to the interrupted status. It's a shame that it is informal - if there's somewhere a spec should be precise and unambiguous, well, it's everywhere, but it's the threading primitives above all.
The way the interrupted status mechanism works in general is if that a thread receives an interruption while it's not interruptible (because it's running), then the interruption is essentially made to wait until the thread is interrupted, at which point it swoops in an causes an InterruptedException. This is an example of that mechanism.
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