Daydream Dragons are the hosts of daydreams and fantasies. They spend the majority of their time sitting on clouds, dropping daydreams down into the minds of people passing by. Humans who live near Daydream Dragons must be especially careful not to let their thoughts wander, or they could end up spending hours or even days in a trance-like waking dream state.

Dragons are highly-intelligent reptilian creatures that—from a human perspective, at least—appear to live forever. Many different varieties of dragon exist, each with their own unique qualities, habitats, and behavior. Adolescence in dragons is usually marked by the growth of a hatchling’s wings, although not all breeds of dragons grow wings and some breeds have other traits that indicate the beginning of maturation. In Galsreim, dragons and humans coexist peacefully.

Dreamscar is no ordinary dragon. He started a group of dragons called "Dreamscars" that only contsists of Daydream dragons. Dreamscar dragons have a small problem with their "feeding off dreams" thing. When he reaches into someone's mind, he can cause or control their dreams, and sometimes they are so terrifying it can scar people and dragons for life.