I'll set the stage:
I was with a group of people travelling by foot into a town that was at once both modern and old fashioned, my first thought was Mayberry, from the Andy Griffith Show but with modern amenities like a modern drugstore and the ubiquitous concrete and steel posts in front of stores that prevent vehicles from ramming storefronts.
These "posts" will have a significance to the story later. They are usually a steel pipe filled with concrete in which the concrete slightly comes out of the top. Apparently they are called bollards.
There was an apparent leader of our group who looked exactly like:
Yes, Lance Henriksen, well known for his role in the movie "Aliens". And like most dream scenarios the man in the dream looked just like the "real" Lance but I "knew" that it wasn't actually him.
We were a small group of people entering this quaint town with modern conveniences and were approaching a drug store on the corner. I noticed that there were people milling about. The town boasted a small "Bijou" type theater. That was another quaint aspect to the place.
The first thing you would notice about the people was that they acted strange. They all moved sluggishly like a typical zombie but looked perfectly "normal", no rotting flesh etc..
The group of people I was with including the Lance Henriksen look-alike were completely normal looking and acting.
We, as a group knew that the town was already overrun with aliens. The "zombie-like" humans were in fact aliens. That was a telling sign in the dream world.
Apparently we were travelling around the country looking for human survivors and also getting supplies. One thing that we, as humans, had in our favor was that the alien/zombies were slow and clumsy and would not attack people in groups unless they had a huge advantage in numbers because they were easily killed.
At first, while we were noticed by the aliens there were only a couple of them in our immediate vicinity. We sat on a bench out front of the modern pharmacy where the bollards were on the sidewalk in front of the store.
We were discussing what to do, and had made up our mind to rest a minute and then move on as the town was overrun. It was at this point that an alien came out of the pharmacy and a couple more joined him and they started to gather. We all got up and formed a tight knit group. When a sufficient number of them had gathered we knew we might be in trouble, and we were only armed with crude weapons like clubs. One of the aliens, the one that had emerged from the pharmacy went over to a bollard and used a small hand-held device that was obviously some type of laser cutter. He started to work on the bollard top. I knew, in the dream, that the aliens used small round discs in some fashion to "turn" humans into aliens, and that ideally they had a specific device they used for this but that any round disc like object would work. The alien was cutting the top of the bollard off to use it as an agent to change us.
The aliens started gathering around us and when they thought they had enough of an advantage number wise a small boy alien of about 14-15 years old clumsily attacked. They only used their bare hands. The Lance look-alike had a bludgeon of some type and beat the kid mercilessly and he was dead on the ground in seconds. Another distinguishing characteristic of these creatures was that they "bled" a black tarry substance and they quickly disintegrated into a tarry mess. By the time our confrontation was over the boy alien was nothing but a sticky tarry black splotch on the ground.
The aliens hesitated and we took the opportunity to gather and start to make our way down the road out of town. We were accosted on our way by one of the creatures who taunted us by saying things like: "We will defeat you", and "We will take over the whole Earth." This led to a heated exchange involving profanity and it was at that point that I woke with a curse on my lips as I started awake and literally sat up in bed.
The most vivid dream I have ever had and one which involves aliens taking over the Earth.