Dreams and delusions have a common link of being associated with faulty reality testing in the brain's higher order cognitive skills making it difficult to come out of the delusions.

"Normally this 'reality testing' in the brain monitors a 'story telling' system which generates a narrative of people's experience," Professor Gerrans says.
"A simple example of normal reality testing is the person who gets a headache, immediately thinks they might have a brain tumor, then dismisses that thought and moves on. Their story episode 'I might have brain cancer' gets tested and quickly rejected.
"In someone who has problems with reality testing, that story might persist and may even be elaborated and translated into action. Such people can experience immense mental health difficulties, even to the point of becoming a threat to themselves or to others," he says.
In his paper, Professor Gerrans discusses delusions triggered by feelings of familiarity and unfamiliarity, such as the "Capgras delusion" – the delusion of "doubles". One example is of a man who, after serious head injury following a motor vehicle accident, returned home from the hospital after a year only to state repeatedly that his family had been replaced by impostors.
"His family looked familiar but didn't feel familiar, and the story in his head made sense of that feeling. It didn't matter how much people tried to point out that his family was the same, in his mind they had been completely replaced by impostors," Professor Gerrans says.
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"People also experience feelings of familiarity and unfamiliarity in déjà vu – a sense that a new place is strangely familiar, and the reverse, jamais vu – a sense of extreme unfamiliarity evoked by a familiar place. However, such feelings do not lead to delusion in people whose reality testing is intact."
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"Trying to treat someone experiencing these delusions by telling them the truth is not necessarily going to help, so new strategies need to be developed to assist them. Ultimately, that's the aim of this work – to help explain the nature of reality testing in order to help people find a way of working through or around their delusions so that the delusions no longer adversely affect their lives."
Source-Eurekalert