SpongeBob has a strange dream, where he is driving a hot rod and he has his driver's license. However, Mrs. Puff appears and rips and tears up SpongeBob's license, and he is then propelled out of his own dream.
He appears as a small, glowing version of himself in the outside world, where he sees himself sleeping. SpongeBob realizes that he has no dream to go to, until he sees Gary's dream cloud. He jumps in, frightening Gary.
In his dream, Gary has a humanoid body and can speak English, and resides in a huge library. Gary tells SpongeBob some limericks before SpongeBob goes out of Gary's dream cloud and into Patrick's. Patrick's dream is completely empty, except for a kiddy ride that he is riding on. SpongeBob explains to him that in a dream, he can do whatever he wants, which he demonstrates by changing size and creating a million copies of himself. Patrick says he's already satisfied, and SpongeBob goes out of Patrick's dream cloud. The ride then stops and Patrick takes out a quarter but drops it in a sewer grid.
Next, he goes to Squidward's dream, where Squidward is playing clarinet for a king in a theater. SpongeBob distracts the king by telling him a limerick that Gary recited in his dream, and Squidward stops, and the king growls at him for not playing. After this happens several times, Squidward becomes so angry that he snaps his clarinet, but SpongeBob saves him by turning into a clarinet. It produces no sound, and SpongeBob just sings horribly, which surprisingly everybody applauds at.
SpongeBob goes into Sandy's dream, where they are skydiving, and have to land on a painted target. SpongeBob asks if it's safe, and Sandy says "Yeah, as long as you have a parachute." SpongeBob misunderstands her, and while trying to explain to him, Sandy fails to open her own parachute in time and lands in a truck filled with manure. SpongeBob falls out of Sandy's dream and says to himself "All right, that's it. No more messing with people's dreams."
However, he then goes to what he thinks is Mr. Krabs' dream, but actually is Pearl's dream, where she is having a tea party with her stuffed animals in a very childish and girlish setting.
After realizing this, he immediately goes to Mr. Krabs' dream, where he's fishing for money. Mr. Krabs instructs SpongeBob to pull out his money net from his back pocket, which turns out to be Mr. Krabs's wallet. SpongeBob and Mr. Krabs manage to catch "Moby Dollar," but it escapes and Mr. Krabs shoots SpongeBob out of the dream in a cannon-like device.
He is launched directly into Plankton's dream. Plankton, in his dream, is a giant monster and can shoot lasers from his eye, and is destroying the city. SpongeBob pokes him with a pin and Plankton deflates, is squashed by the angry townsfolk, and wakes up.
SpongeBob then goes back to his own dream cloud, where the angry faces of everyone who's dreams he entered appear around him. When he wakes up, everyone is in his house complaining that he's messed up their dreams. Patrick then appears and asks "Does anyone have a quarter?" then everybody looks at Patrick in a strange way.
Here is a list of all the dreams that were seen in this episode:
SpongeBob's Dream: SpongeBob is driving a racecar through a world filled with Krabby Patties. He gets his driving license, but Mrs. Puff appears and rips it up, saying "Not even in your dreams, Mr. SquarePants."
Gary's Dream: Gary is the humanoid keeper of a vast library.
Patrick's Dream: Patrick is riding a kiddy ride in the middle of nowhere.
Squidward's Dream: Squidward (aka Wolfgang Amadeus Tentacles) performs at a clarinet recital for a king.
Sandy's Dream: Sandy is skydiving from an airplane to land on a red target.
Pearl's Dream: Pearl is having a tea party with stuffed animals in her fantasy world.
Mr. Krab's Dream: Mr. Krabs is at sea during a storm, trying to catch "Moby Dollar."
Plankton's Dream: Plankton is a giant zapping Bikini Bottom.
SpongeBob's Dream 2: When SpongeBob tucks himself into his bed in his dream bubble, he is surrounded by all of his angry friends' heads.
Patrick is the only one that didn't get angry to SpongeBob for entering his dream.
This is the first episode to premiere in 2000, and the 21st century.
It is unknown whether Sandy's dream happened over land, or underwater. Sandy is without her helmet, skydiving, which is impossible underwater, but SpongeBob isn't wearing a helmet, However it's Sandy's dream and she can do whatever she wants.
Gary says "Beware of your wandering eye, you little poriferan." in his dream. The sponge is in the Phylum Porifera.
SpongeBob tells Gary, "Curiosity salted the snail," a reference to the classic line, "Curiosity killed the cat," as snails are portrayed as the cats of the sea.
Glitter appears on the title card background. Glitter is also used in the title card for "Imitation Krabs."
In Pearl's dream, there are framed photos of what look like the members of Boys Who Cry, a band who appears in "Whale of a Birthday," which was made several years after this episode.
Running Gag: SpongeBob ruining people's dreams.
In the video game Battle for Bikini Bottom, there is a stage based on this episode: SpongeBob's Dream, where it takes place in the dream world and allows SpongeBob to visit the dreams of other characters. Also, one of the robots that appears in the level is called a Sleepytime (behind the Krusty Krab).
The video game Creature from the Krusty Krab is very similar to this episode. The game's third act, in which SpongeBob and Patrick battle a giant Plankton, is directly based on Plankton's dream in this episode.
The scene where SpongeBob licks his plate in his dream has been cut out from later airings for unknown reasons.
In this episode, SpongeBob's driver's license says he lives on Conch Street. But in a later episode, "Slide Whistle Stooges," it is stated that Squidward lives on Conch Drive, but that's not possible because Squidward is SpongeBob's next-door neighbor. However, different things happen in different episodes.
Plankton's dream is very similar to what happened at the end of a much later episode "Wishing You Well." He grew big and starts destroying the town, although, he didn't have lasers in that episode. It may have also been the basis for the Creature from the Krusty Krab video game and the cover art, complete with Plankton destroying the town, and the lasers coming out of his eye.
Mr. Krabs' dream is similar to the later episode "Clams."
The name that Squidward has in his dream, Wolfgang Amadeus Tentacles, is a parody of Wolfgang Amadeus Mozart. Coincidentally, the Andante from his Piano Concerto No. 21 is playing in the background while SpongeBob is in Gary's dream.
Sandy crashing into a truck of clam manure is a reference to the running gag from the Back to the Future movies where Biff crashes into a truck of manure.
In one scene, when Gary and SpongeBob are walking along the library, a book is shown close up. On the cover, the title says "Of Snails and Men," a parody to John Steinbeck's novel, "Of Mice and Men."
Gary and Pearl are angry at SpongeBob, but he did not do anything in their dreams that caused them physical harm or prevented them from doing what they wanted to do.
When SpongeBob is outside Squidward's house, it shows the window open, but there is another window frame on the wall.
Closed-captions error: When Sandy says 'Not a parakeet, Para-' then falls into a truck of clam manure, she says 'medic' as an 'paramedic', but the caption reads, 'made it'.
In Mr. Krabs' dream, when he says "You're fired!" to SpongeBob, his nose is straight instead of crooked. This also occurred in other early episodes, suggesting it is a mood change.
When SpongeBob comes to Pearl's dream, he enters at the left part of the house, but when he comes out, he exits from the middle of the house.
When everyone is standing around SpongeBob's bed at the end of this episode, at first Pearl's night cap seems to be missing. In the next shot, it is there.
When SpongeBob come to Sandy's dream, when he falls out of the airplane a few moments later Sandy flies in from the right, then they continue to fall at the same speed until hitting the ground. Therefore for Sandy to have come into the scene from SpongeBob's right, she must have fell from the airplane at the same time as SpongeBob, however this is not shown at any time in the scene.