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.

Baku not only induces dreams—he claims he can eat them. He often goes on about the many different flavors, stating that they can range from deliciously sweet to disgustingly bitter. It depends on the type of dream.

This notion is farfetched as it is, but oh no, it doesn't end there. Not only can he eat them, but he can travel INTO them. With a dreamy look in his eyes, Baku tells tales of his fantastic adventures in lands of fantasy; lands that should and do not exist. He cheerfully states that there is a unique place 'in everyone's head.'

Few dragons ever take Baku seriously. Some of the blunter ones even think he should be taken to a White dragon for some 'mental therapy.'