Nancy Wagaman Interpretation: Dreaming that you’re mentally unstable can represent a feeling or fear of: Not being able to think clearly or logically.
Others not accepting you.
Being unable or unwilling to deal with your life right now (as in frustration, overwhelm, or a low tolerance for problems or responsibilities).
Someone else being mentally unstable can mean you’re attributing to them one of the things just mentioned, or you feel that a situation or person seems unpredictable or “off” somehow.
This could also be an indicator of a Toxic Dream.
See also: Unstable; Confused; Disabled; Weird