Neil Gaiman's Sandman series is considered by many to be one of the most brilliant works in the writer's extensive career, and its enigmatic protagonist is its most defining feature. Although he began as a forgotten DC vigilante, Morpheus/Dream received a life-changing upgrade when Gaiman made him The Lord Of Dreams.
As one of the Endless, the Sandman himself has become the textbook example of phenomenal cosmic power. While he's a favored hero for many comic book fans, his abilities venture into godlike territory on more than a few occasions. Even entities like Darkseid and the Devil himself can be overcome by some of his dream-driven power.
Immortality
Honestly, immortal superheroes are nothing new, one only needs to look to characters like Thor and Deadpool for prominent examples. But Dream isn't exactly a God or a mutated humanoid, he's far more complicated than the garden-variety metahuman found across the multiverse.
Dream, Death, Desire, Demise, Destruction, Destiny, and Delirium are The Endless, a family of anthropomorphic manifestations of forces of nature. As long as these forces exist across the known universe, so do The Endless. They might not be gods or deities, per se, but they certainly meet a lot of criteria.
Telepathy
Dream has proven time and time again to be a master of the mind, seeing as how he draws his power from a dream dimension. But his telepathic abilities go way beyond those of characters like Martian Manhunter or The Ancient One, and it can be a scary notion at times.
In no uncertain terms, there are no secrets from the Lord of Dreams. Since he is practically responsible for the dreams of the known universe, all wishes, hopes, fears, and darkest desires can be uncovered with a single word from the Sandman. And almost no human, deity, or demon is immune.
Shape-Shifting
Like most of his abilities, what might seem a standard issue for many superheroes is highly upgraded for Dream. Not only can he change his form into various appearances and aesthetics, but those he encounters can also affect his physical form.
While many characters Dream encounters can see him as the pale, gaunt figure that graces so many comic panels, otherworldly characters like Martian Manhunter and Queen Nada see him in forms that fit their frame of reference, be it a tribesman or an ancient Martian god. There's a Dream for every occasion.
Enhanced Teleportation
Not only can Dream warp from one place to another on a physical plane, but his reach stretches beyond dimensions and realms as well. Whether it's in or out of The Dreaming, the Sandman can venture anywhere he has a foothold or connection. Since nearly every living creature sleeps, therefore dreams, his territory is practically infinite.
He can exist in the dream realm, the physical world, and various astral plains, and even spiritual realms. It's not as simple as appearing with a poof of smoke, but he definitely has multiple avenues of dimensional travel.
Enemy Incapacitation
Dream is a pretty impressive entity all on his own, but his enchanted relics certainly up the ante by a multitude of levels. Dream wields a trio of vestments that grant him many of his powers, a helmet, a ruby amulet, and a pouch of sand. Through this third artifact, he can instantly send a target into a dream state, be it sleep or lack-there-of.
It's somewhat terrifying to know just what Dream can do with his endless supply of black sand. With a pinch, he can simply put someone to sleep, but he can also place them in a state of permanent walking nightmares. For something so simple, it could be the deadliest weapon in the wrong hands.
Magical Abilities
Along with the rest of The Endless, Dream has an incredible understanding of the mystic arts, making him one of the most powerful magic-users. In fact, most of his abilities and enchantments could be seen as magically powered or induced. Throwing in his immortal status, and various other powers into account, his magical prowess isn't much of a surprise.
Conjuration, transfiguration, and various forms of physical manipulation are just a few of the magical gifts Dream has shown in the series, and it's likely he's capable of far more.
Semi-Invulnerability
As demonstrated in Preludes and Nocturnes, while it is indeed possible to subdue, incapacitate, and hurt Dream, he's not one to go down easily. Once again, his status of immortal anthropomorphic personification grants him a phenomenal blanket of protection from most threats. Most, but certainly not all.
He can be rendered weakened if his vestments are used against him, such as Doctor Destiny wielding the Dream Ruby, but even that has a way around it. He can be subdued, but those who try will be in for a nightmare afterward. It will truly be a daunting feat for the series adaptation.
Semi-Omniscience
In order to be a nearly all-powerful cosmic being, a certain amount of omniscience is practically mandatory. While the character is not necessarily all-knowing, he does have all permanent information of anything that dreams, as well as the dreams themselves.
Through the use of The Dreaming, Dream is able to see the innermost mental machinations of any sleeping soul. The secrets of the universe are his to know and add to his vast and growing library of stories. Being responsible for a realm upon realm of dreams, nightmares, and imaginings definitely comes with some perks.
Reality Manipulation
To say that Dream can manipulate reality is a bit of a tricky statement. Within The Dreaming, he can conjure, manipulate, and manifest various objects, forms, even worlds, essentially bending the entirety of the plane to his whim. Outside his realm, it's more about illusion and suggestion, yet still within his boundaries.
Dream can make anyone affected by his sand see whatever or think whatever he desires, essentially forcing them to dream. As long as they are in the confines of his realm, the reality is his to control.
Dimensional Control
Here is where Dream becomes one of the most powerful beings in Vertigo Comics. The Dreaming has been mentioned several times already, but it's such a necessity to Dream's existence that it's more than just the place where he draws his power. It's his world, his dimension, and his plane to command and control as he sees fit. In no uncertain terms, he is a god in this place.
He can create structures, environments, and even living beings like the Corinthian. While he's not the only being that calls this realm home, he is the reason for its existence, essentially an avatar of The Dreaming.