During dreams the brain as a whole is active from the brain stem to the cortex. Most dreams occur during REM sleep, which is part of the sleep-wake cycle and is controlled by the activating system whose circuits travel a path from the brain stem, through the thalamus, and to the cortex.
It has been discovered that during the dream state, there is increased high-frequency activity in the region of the brain involved in face recognition. The actual content cortex as a whole using processes that may be similar to the imagination.
The brain is known to be a complex organ in the vertebrate body and it is active during dreams. Thus, brain generates two distinct types of sleep which were slow wave sleep (deep sleep) and rapid eye movement (REM). Dream is experienced in all stages of sleep but it is vivid during the rapid eye movement (REM) which is controlled by reticular activating system which runs from the brain stem through the thalamus to the cortex.
However, cortex is known to be responsible for the contents of the dream and limbic system which is found in the mid-brain deals with emotion that is involved in dreaming and waking while amygdala is associated with fear and it is active during dream.