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.

Aesir the Ridiculous Daydream grew up with his mother, a very special, very magical caveborn silver. His whole life was steeped in magic. Though he didn't have the magical fortitude of his mother, he still inherited some, as well as that of his father's dubious lineage. Aesir had heard stories about his father, a Ridiculous daydream with vicious yulebuck blood. Though it saddened them both, Aesir left seeking his father's clan when he came of age.

He met many Ridiculous dragons along the way, but none would speak of his father. Aesir wondered why. When he finally found Haggis the Ridiculous, he understood. Haggis had grown close to his father, the evil Haggis the Fearsome. They tried to bond with Aesir by teaching him nightmare magic, but Aesir was disgusted by their practice. He almost killed his own father in a fierce magical showdown, but stayed his hand at the last minute. Too embarrassed to return home to Terrapin Station, he now lives as a legend among the Ridiculous dragons.