The Sandman lives in the Land of Dreams located in the Realm of Fairies in the potentially imaginary world known as Nowhere. He ruled over his realm, placing a blanket over it daily. Those who grabbed a dream from the dream tree would have a dream based on whatever they grabbed from the tree and awaken again when the Sandman removed the blanket over his land. Those who did not get a dream from the tree would be stuck in an eternal dreamless sleep.
The Sandman's blanket causes those covered by it to sleep. The effects would be temporary if they managed to collect a dream from the dream tree in his realm; otherwise, they would be stuck in an eternal, dreamless sleep.