Since ancient Greece, humanity has always taken its dreams seriously. In the nineteenth century, the scientific investigation of dreams started in the Western intellectual world, regarding dreams as closely related to the unconscious and believing that dreams reflect the activity of the mind during sleep. Psychoanalyst Sigmund Freud called dream interpretation the “royal road” to the unconscious, and he demonstrated that human behavior, seemingly guided by conscious motives, was on the contrary the product of the powerful unconscious. In its peculiar narrative style and dream languages, Joyce’s Finnegans Wake, which explores and fully represents the unconscious, shares characteristic features of Freud’s dream theory, though Joyce denied the influence of Freud’s psychoanalytic theory on his literary world. This article explores how the dream mechanisms of Freud’s theory corresponds to those in the text of Finnegans Wake. It discusses two main subjects: one is concerned with themes of the text such as “fall,” “guilt,” or “fear,” which cause the feeling of “agenbite of inwit” in the unconscious mind of the dreamer, HCE, and which provide the matrix (the central sources) of both the content of his dream and the variety of stories and episodes of Finnegans Wake, especially that of the first four chapters of the text; the other subject is the narrative technique and dream language of the text, which share the idea of the dream mechanisms of Freud’s theory. The article discusses how the dream mechanisms of Freud’s theory, especially those of “portmanteau,” “displacement,” “condensation,” and “censorship,” work in Joyce’s linguistic devices of puns and portmanteau words in Finnegans Wake.