The Mahayana Sutra on the Manifestation of Consciousness (52)

said to the Buddha, "I earnestly beseech you to explain." The Buddha told Bhadrapāla, "The sights seen in a dream are called the inner eye's perception. This is a discrimination of wisdom, not a seeing by the physical eye. The inner eye's perception, due to the power of mental focus (念力), momentarily appears to a blind person in a dream. Furthermore, through the power of mental focus, upon awakening, one recalls it. The inner forms of consciousness are also like this."

Explanation: Bhadrapāla addressed the Buddha, saying, "I earnestly beseech the World-Honored One to explain."

The Buddha told Bhadrapāla that the forms seen in a dream are called the inner eye's perception. This is a discrimination of wisdom, not a seeing by the physical eye. Due to the mental faculty (意根) and the power of mental focus, the conscious mind (意识心) of a blind person immediately arises and functions in a dream, enabling them to see all the people and scenery in the dream. Then, through the function of the mental faculty's power of mental focus, upon awakening, the conscious mind recalls all the scenes from the dream. Dreaming occurs because the mental faculty's tendencies to grasp and its power of mental focus cause the dream state to manifest; it is propelled by the mental faculty's volition, feelings, perceptions, and thoughts. After awakening, the mental faculty causes the conscious mind to recall the dream because the mental faculty itself cannot recall or discern subtle details; it relies on the conscious mind to assist in recollection. The inner forms manifested by the ālaya consciousness (阿赖耶识) are also like this; they are manifested through the mental faculty's grasping nature and power of mental focus. The ālaya consciousness itself is formless, yet it can manifest all forms, including the five aggregates of form (五蕴色).

The inner eye refers to the conscious mind. It is the wisdom nature of the conscious mind that sees, not the eye consciousness (眼识). In a dream, only the conscious mind is present; there is no eye consciousness. The forms seen in the dream are not seen by the eye consciousness either; they are seen by the independent consciousness (独头意识), without the simultaneous discrimination of forms by the first five consciousnesses.