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Notwithstanding the progress in dream science, key questions concerning the individual significance and functions of dreams are still open in dream research and theory. Unlike adults' common dreams, where interpretation is hindered by the bizarreness of their content, the simple forms of children's dreams may help us understand the functions of dreaming. This study analyses the frequency and types of wish-fulfillment dreams of young children and their respective daytime experiences to which these dreams seem to refer, collected systematically to identify their daytime sources and develop a hypothesis about the functions of these dreams. The results show that children's dreams often fulfill a wish originated in recent daytime, where it was associated to an intense affective state. Through such hallucinatory fulfillment, these dreams apparently resolve the associated affective state (the “affective-reestablishment” hypothesis). These results are consistent with Freud's emphasis on wishes in the dreaming process, as well as with Solms's neuropsychoanalytic model, where dream processes are initiated by the motivational mesocortical-mesolimbic system. The observed motivational and emotional nature of the sources of children's dreams upholds the neuroimaging data that provide evidence of a greater activity of the brain regions involved in the reactivation of the affective components of memories during dreaming state. The affective-reestablishment function shown by children's dreams is consistent with the dream-function hypothesis formulated by Freud and is compatible with emotional adaptive theories on dreaming. Furthermore, the affective-reestablishment function fits in with recent studies on the role of sleep in “dissipating” the emotional charge of recent daytime life and reducing next-day subjective emotionality.