We investigated the impact of imagery rehearsal treatment (IRT) on nightmare frequency, psychological distress, and sleep quality using polysomnography (PSG). 12 chronic nightmare patients completed prospective dream logs, measures of psychological distress, and underwent PSG prior to and 8.5 weeks following a single IRT session. Post-treatment, significant reductions were observed in retrospective nightmare frequency (d = 1.06, p = .007), prospective bad dream frequency (d = 0.53, p = .03), and anxiety scores (d = 1.01, p = .004). Minimal sleep alterations were found post-IRT, and varied as a function of nightmare etiology. The results independently replicate the efficacy of IRT for alleviating disturbing dreams and psychological distress. Sleep improvement may occur later in the recovery process.