Not only do they dream, I'm pretty sure they have nightmares. More than once I've watched my Isis twitch in her sleep, and then start growling. I usually wake her up when it happens, but very carefully, as I don't want to get bit!

The first time it happened, it scared the heck out of me. I couldn't for the life of me figure out what she was growling at, until I realized that she was asleep.