Why are dreams so realistic?

Isn't it strange how realistic they are? Like this morning I was apparently asleep but anyways,
I was just waking up and I checked my IPhone. Then I saw all these facebook messages from my crush and they all said like i love you and stuff. Then a few minutes later I actually wake up into real life and I checked my phone to see if they were real and they werent. Pooo.xD

But anyways, why are dreams so realistic, and what makes them that way.

Human brains are pretty amazing things. They know what you want and can reproduce life pretty vividly. As brains operate from our subconscious during REM cycles of sleep to produce dreams, they interpret events of that day, our desires, our fears, and random thoughts floating around into real life scenarios in our head. Our brain can produce feelings and senses as if it was real life. It's pretty cool, and not even scientists understand all of it.

Because dreams are using substantially the same systems that your senses use to interact with the outside world. When you see something, the light hitting your eyes is converted into electrical signals which are reconstructed in consciousness. Dreams use a similar process, but calling more on memory than direct visual input.

That said, some dreams can be more real than others. The most obvious difference is when we realize we're dreaming in colour, or when the dream includes a taste or smell.