Dreaming of being unprepared for an exam often indicates that you are critically examining your performance in waking life. You have set yourself some standards in daily life that you think you need to achieve in order to be truly recognized and appreciated by other people. If you feel that you aren’t managing to live up to these standards, however, then you will feel that you have failed in some way.

Although it may seem like an external authority is setting the exam, it is you who is setting the criteria for whether you pass or fail. You feel unready for this critical period of self-examination because your level of self-awareness isn’t as deep as you would really like it to be.

Your feeling of being unprepared often arises because you tend to leave nothing to chance in your waking life. You usually prepare meticulously for any task that you have to do, whether it is a major project or a trivial errand. This can lead to expecting far too much from your performance and creates a constant anxiety that you will end up with a poor result.

Even though this tension drives you on and gives you an enviable record of consistent success, it can also result in you neglecting some of your more fundamental needs. The real criteria for success isn’t whether you achieve a certain level of competence but how much you know about what makes you really happy and fulfilled in life.

The best way to successfully move on from this dream is to consider what makes you happiest and most fulfilled in life, and how successful you are in achieving it. This is often something joyous and spontaneous, which doesn't require endless preparation.

When you judge yourself too harshly, you will always feel like a failure, no matter how brilliantly successful you might actually be in waking life. Rather than immersing yourself in endless self-examination, the real test of your character is being able to accept your talents by celebrating your knowledge and achievements, instead of constantly judging them.

Examinations are how we are judged according to the expectations of others and they reflect how we judge ourselves according to our expectations. Although formal academic testing has been practised for thousands of years, tribal rituals and challenges preceded it.

These rituals often involved initiation ceremonies where participants had to attain certain levels of performance in order to achieve acceptance in their tribe. It is important to be accepted and recognized by others but it is even more important to accept your talents and to recognize your achievements.