Nemo has always had terrible nightmares. Together with his best friend, teddy bear Tedd, he has to fight the monsters every night. One day his dreams come to life during the day and Nemo scares Alice, the girl he is in love with. He only wants one thing - to never dream again! He then gets a visit from the dream guard Morpheus who promises him exactly that. With the help of a dream stone, Nemo can lock his nightmares away forever. But that also locks Tedd away and then the stone is also stolen! Can Nemo get his dreams back?