"Yumekui Merry" centers around Yumeji Fujiwara, a high school student with the unique ability to foresee people's dreams. His life takes a dramatic turn when he encounters Merry Nightmare, a dream demon who has crossed into the human world. Merry, whose true form is that of a cat-like creature, seeks to return to the dream realm but is trapped in the human world. Yumeji becomes entangled in her quest, discovering that the boundary between dreams and reality is far more fragile than he imagined.

The narrative explores the conflict between dream demons, known as Nightmares, and humans. Nightmares are entities that feed on human dreams, often causing harm or distress to their hosts. Merry, unlike other Nightmares, is benevolent and seeks to protect humans from the malevolent intentions of her kind. As Yumeji and Merry work together, they encounter other Nightmares, some of whom pose significant threats to both the dream and human worlds.

Key characters include John Doe, a mysterious and powerful Nightmare who serves as an antagonist, and Isana Tachibana, a classmate of Yumeji who becomes involved in the supernatural events. The story delves into themes of identity, the nature of dreams, and the consequences of crossing boundaries between worlds. The plot is driven by the characters' efforts to navigate these complex dynamics, with Yumeji's abilities playing a crucial role in their journey.

The series balances action, mystery, and emotional depth, with a focus on the evolving relationships between the characters. As the story progresses, the stakes escalate, revealing deeper layers of the dream world and the true nature of the Nightmares. The interplay between the human and dream realms creates a rich narrative tapestry, with each arc contributing to the overarching plot and character development.