In the interpretation of dreams, Demon is among the recurring images that traditional dream-books and modern depth psychology have alike tried to read. It is commonly interpreted as inner fears, temptation, guilt, and destructive impulses.
Common readings
A demon is generally read not as an external being but as an image of the dreamer's own fears, temptations, guilt or destructive impulses.
The reading of dream symbols has a long documented history, from the Oneirocritica of Artemidorus in the second century to Sigmund Freud's The Interpretation of Dreams (1900) and the archetypal psychology of C. G. Jung. Such meanings are interpretive conventions of those traditions, offered here as ways the image has been understood rather than as fixed or established fact; in practice a symbol takes much of its sense from the individual dreamer and the setting of the dream.
The sleep researcher David J. Hufford, in The Terror That Comes in the Night (1982), documents sleep paralysis, a real, well-studied neurological phenomenon in which REM-sleep muscle atonia briefly persists into waking consciousness, as the likely physiological basis behind a strikingly consistent set of folk traditions across unrelated cultures describing a malevolent nocturnal visitor, an "Old Hag," an incubus, a demon, sitting on or pressing the sleeper's chest. This is a genuinely documented convergence between a specific, verifiable physiological event and widespread, independently arising cultural interpretation, distinct from the vaguer, unattributed claim that dreaming of "a demon" in the ordinary, non-paralysis sense carries any single fixed symbolic meaning.