Animal Crossing: New Horizons players can have their villagers sleep and visit other islands while they dream. While you normally have to ask your friends to let you onto their islands, dreaming allows you to freely “imagine” yourself on their island when they’re unavailable.
Luna and Dreams for Dummies | Animal Crossing New Horizons
In order to allow friends to visit your island, you will need to create a Dream Address. You will do this with the help of Luna, a tapir NPC. She will essentially act as a dream guide for you.
Make sure you have a bed somewhere in your house. Go to your bed and push the joystick forward to lie down on it.
A prompt will appear asking, “Should I get some sleep?”, and you select “Yes, I want to sleep…”