Any Lord of the Rings fan will know that dreams are hugely significant within Tolkien's books and their film adaptations. Dreams often give prophecies and messages that are essential to the fellowship in their quest to destroy the one ring of power. When the characters dream, Frodo is given a vision of Gandalf escaping the Tower of Orthanc, Aragorn is granted hope and inspiration in the form of his true love Arwen, and Faramir is sent the prophecy that tells him he should the fellowship at the Council of Elrond.
But there is one character whose dreams are altogether more unusual. Legolas, the elf prince of Mirkwood, is one of the 9 members to accompany Frodo and Sam on their journey to Mount Doom. As an elf, Legolas has certain abilities and gifts that the other, mortal members of the company don’t possess. One of these can be seen when the comrades journey over the Mountains of Caradhras, and his steps are so light that they don’t even leave footprints in the snow. Another can be seen when his keen elf eyes spot the Crebain of Dunland flying a few miles away, in time for the friends to hide out of reach of the spies. And the third, arguably the most interesting of all, is the ability to dream whilst he is awake.
Elves don’t sleep in the traditional manner of men or hobbits. When he, Gimli and Aragorn, are tracking Merry and Pippin, who have been taken by the Uruk-hai, Legolas is described as sleeping with his ‘eyes unclosed, blending living night and deep dream, as is the way of the elves.’ It is worth noting that in all of the 3 films, we never see Legolas sleeping. He, like many others of his kind, is able to send his mind into another realm, a sort of hypnotic state, whilst his body is still awake and active. The quote "he could sleep, if sleep it could be called by men, resting his mind in the strange paths of Elvish dreams, even as he walked, open-eyed in the light of this world."
This rare and uncanny gift allows him to be a phenomenal lookout whilst the others sleep around the fire, as he is able to both keep watch and recharge his batteries in the restful domain behind his open eyes. He is shown pacing, singing softly to himself and watching the stars turn into morning whilst the other two earn some much-needed recuperation after the day's orc pursuit.
Lots of questions arise about whether this is something inherent to elven DNA or lineage, or whether this is a skill that has been learned across their many immortal years. It is a valuable skill in the light of the many great battles that have been fought across Middle Earth, for it would allow soldiers to keep fighting and protecting their kingdoms whilst still catching the rest they need to survive. It is possible that one other among the fellowship has been blessed with learning how to enter this secret sleep realm of the elves.
Surprisingly, although Aragorn was in fact raised by Elrond In Rivendell, and also possesses the long life of the Dunedain, it isn't him. Gandalf, known by all as a friend of the elves, has been around for thousands of years, and in that time, he may have learned how to enter the elven dream land. This can be seen in the 2002 film adaptation of The Two Towers by Peter Jackson, when Gandalf is seen sleeping with his eyes open as Pippin sneaks over to take the Palantir from him. Gandalf very quickly rouses from his dreams as Merry yells for help, which suggests that Gandalf was only drowsing his mind, whilst his body was still awake and alert.
However, it appears that elves may actually pass into an unconscious state when inebriated. This is a creative license on the behalf of Peter Jackson in The Hobbit films, in which a group of elven guards pass out at the table as Bilbo gets the dwarves into the barrels and makes their hasty escape from the elven prison. The elves have clearly had too much to drink during festive celebrations, which is difficult to believe considering how tolerant Legolas is of alcohol during his drinking match with Gimli. The dwarf is drunk enough to pass out under the table, whilst the elf only feels a slight tingle in his fingers. The elven guards would have had to drink an extraordinary amount of liquor to reach their state, but there is no suggestion in the books that elves ever become unconscious at all.