What Does Dreaming of a Caterpillar Mean?
Traditional Interpretation
In the tradition of Ibn Sirin and al-Nabulsi, the butterfly's larva (the caterpillar or cocoon) can be a sign of a good not yet mature but carrying great potential for change within it, of a destined portion that must be awaited with patience; the silkworm's cocoon in particular can signify abundant provision born of little effort, and a worth still hidden from view.
Psychological View
In modern psychology, the larva and the cocoon can indicate that a person stands in the middle of an unfinished transformation, growing protected through a phase of transition and withdrawal; this dream may be a message from the unconscious that you have entered a season of maturing in which you must be patient and give yourself time.
By Context
For a Single Person
Seeing the larva inside its cocoon can point to a bond of the heart not yet mature but destined to grow lovelier with time, or to preparations for a new beginning that will change one's life.
For a Married Person
The caterpillar spinning its cocoon can signify a blessing to come after a period of patient waiting in the family, a birth, or a peace ripening within the home.
Seeing the Larva Turn into a Butterfly
According to the Ibn Sirin tradition, this can point to a troubled period coming to an end, and to relief, freedom, and the fulfillment of a long-awaited wish.
Seeing a Silkworm's Cocoon
Can signify plentiful, lawful provision to be gained with little effort, a hidden talent coming to fruit, or gain born of work that seems small.