Human beings receive both physical and mental nourishment. As you grow, you are trained to express behavior that is ‘correct and good.’ Your more natural way of expressing yourself in behaviors that may have been classified as bad, can become repressed within the unconscious. Maybe you were exuberant when your family was not. This part of your nature does not go way, but continues to seek expression. Dreaming is a way for the psyche to express and integrate unprocessed qualities that you believe are not acceptable.
Nightmares or dreaming of something evil is actually the personification of your own misplaced power. They are a sign that something powerful and good (yet unexpressed) is coming to the surface.
Nature abhors a vacuum and energy that is created does not disappear; it simply transforms. Unprocessed ideas can fund a fear of a boogeyman or the enemy 'out there' who simply mirrors how you might confront the things you are hiding in here.
The less this energy finds natural and outward expression, the more powerfully it colors dreams, giving added charge and dimension to your encounters. If you are brave enough to open the door of your fears, you would find your childish and disowned nature, standing on a stool like the Wizard in the story of Oz. The by-product of disowning your natural vitality is how you create the idea of good and evil out there to avoid taking responsibility for what is happening in here.
The ancient stories at the root of western religion personified good and evil as opposing characters. Nature teaches us how opposite forces simply drive life in a state of change. What we might label as bad is the way that something evolves before we can understand its purpose. The ancient Greeks first described evil as the uncivilized passions that were not actively under the control of the will. As these ideas were tossed through the hands of time, and applied to dogma, the image of evil merely gives us permission to become victims.
Today, psychologists agree that evil is something that is committed by people conflicted by inner crisis. While you may believe that there is some mysterious or negative influence working against you, life has been committed to your success since the beginning. Denying or repressing anything only gives it the power to overwhelm you. Because it is repressed, it can become obsessive and compulsively driven. You become drawn to the very situations you fear because the psyche, like any other part of the body, seeks to process any energy that is unhealthy and counter-productive. See Shadow and Archetypes and Universal Characters.