Here at Busy Teacher there are now 11 worksheets available that deal with the topic of sleep and dreams. This is just one of those worksheets. It contains a nice reading passage for elementary students along with several activities and answer keys. There are multiple choice questions, a matching exercise, a drawing activity, and even a homework assignment included in the file so using it in your ESL classroom could not be any easier. Take a look at the other worksheets to find something else if this is not quite right for your students.
Sleep and dreams will come up in different sections of your course. Most beginners will start talking about sleep when they discuss routines and the simple present tense. Dreams do not need to refer only to dreams students have while they are asleep, although certainly in this section it is easy to make that connection. You can ask students to talk about their dreams for the future, their dream jobs, and other aspirations too. In upper level courses sleep and dreams can also be used as a discussion topic but you should choose an article with a narrower focus. Use the general topic in your introduction and to get the discussion started. Then refer to an article about a specific aspect of this so that students can organize their thoughts and ideas around the main point of the article. As you can see, this is a good topic for all levels.