I was asked a question in one of my workshops recently, "How do lucid dreams occur and can I force myself to have them as they are really cool." A lucid (clear) dream is one where you know you are dreaming and in control of the dream. They are extremely vivid. The movie Inception is roughly based on lucid dreams.
From what I have read about dreaming, they are nothing more than events of the last day or two being consolidated into our memory, or they are our fears and/or insecurities. Bad dreams often occur when we are too hot, if we get too hot our brain awakes as we are in deep REM (rapid eye movement) sleep. Common dreams such as falling often equate to a fear of heights or a fear of failure.
Lucid dreams occur mostly in lighter sleep just before waking or after waking and drifting back to sleep. The challenge that we have is that lucid dreams are often random, they come out of nowhere, and we when realise we are actually dreaming and can do whatever we want in them, we wake up!
There are known benefits to lucid dreaming - they can be good for our spirituality, people who have them tend to be more aware of their surroundings during the day than those who don't have lucid dreams, and you wake up more refreshed than from a regular dream.
Lucid dreams allow us to play with the dream, to become superheroes, to do things that we couldn't do in real life. It can also a way of ridding ourselves of recurring nightmares and of our fears but this needs to be controlled by a specialist in psychotherapy/psychology.
A note of caution, if you have certain 'mind' conditions such as schizophrenia, lucid dreaming may exacerbate your condition therefore do not mess around with sleep patterns or with dreams. In fact, my advice for everyone is to enjoy the lucid dream as much as you can at the time and then forget them.
On a final note, don't spend time over-analysing your dreams, lucid or otherwise. Analysing dreams can be helpful, over-analysing them (examining in too much detail) may cause us to angst rather than to relax. Happy dreaming.