No, its not. Dreams occur during a stage of sleep called rapid eye movement, which is associated with a certain part of the brain (can't remember what its called). There are some people who have damage to this section of the brain, and as a result they do not dream. They've been studied by scientists and psychologists, but they certainly do not go crazy.
There are various theories on what dreams actually are, but I think that most dreams are mostly just random images and memories pulled out by our brain, trying to put them into some order, hence making some sort of story. Its said that some dreams are your unconscious minds way of working on problems you've encountered earlier that day. This might be why they sometimes make sense and reflect what your worrying about, or have been thinking about throughout the day.
There are various theories on what dreams actually are, but I think that most dreams are mostly just random images and memories pulled out by our brain, trying to put them into some order, hence making some sort of story. Its said that some dreams are your unconscious minds way of working on problems you've encountered earlier that day. This might be why they sometimes make sense and reflect what your worrying about, or have been thinking about throughout the day.