The statement asserts that both the perceived external world and the state we consider 'waking' are illusory, akin to dreams. What we experience through our senses, the solidity of objects, the flow of events, even our own sense of being an individual in this life, are all transient phenomena. Ramana Maharshi, a prominent sage of Advaita Vedanta, points to the illusory nature of the empirical reality, which in this tradition is often referred to as 'maya'. Maya is the cosmic illusion that veils the true nature of existence, making the unreal appear real.

The deeper, esoteric meaning, rooted in Advaita Vedanta, is that the only enduring reality is the Self, the Atman. This Self is not the ego or the individual personality, but the pure consciousness that underlies all existence. It is the witness to the dream of the world and the dream of waking. The ultimate goal, as taught by Maharshi, is to recognize this Self, to realize that 'I am That' – the formless, eternal consciousness that is identical with Brahman, the Absolute. The waking state, though seemingly more solid than a dream, is still a construct of the mind, subject to change and impermanence, and thus also part of the grand illusion.

In your life: Practice observing your thoughts and perceptions without identifying with them. Notice how fleeting they are, and seek the silent awareness that remains constant behind them.