Dreaming of a demon means you have committed a crime or a guilty act. Now instead of seeing yourself free from the burden of knowing that you did wrong, your guilty conscious is nudging you to do the right thing before you are thrown into a nightmarish hell inhabited by demons and your worst fears such as getting caught in the act.
Demons in dreams signify your association with evil. You are fighting yourself to go through with an act that will harm or hurt someone. A carefree person will rarely conjure up dreams of demons and the underworld.
Demons can take the form of outer menaces or inner fears. Some demons take physical form and refuse to let a person rest while they are unconscious.
Some people report that their demons have taken the form of emotions and psychological problems that they noticed in themselves, but which they wanted to get rid of. These people often use the idea of “waking up” from the dream to indicate some kind of psychological breakthrough.