The album sold over 1.5 million copies in the United States and was certified Platinum by the Recording Industry Association of America.

It is Dream's only major album release after Reality (2003) was shelved and the group was dropped by Bad Boy Records.

Shortly after being formed, Dream's former manager, Judith Fontaine, signed them to Clockwork Entertainment so they could begin working on their debut album.

Initial pressings of the CD feature a darkened cover, making the background look brown as well as the picture and text being harder to see, and a misprint on the track listing.

"[5] David Browne, writing for Entertainment Weekly, was lukewarm on the album, praising the first couple of tracks and the girls' competent vocal delivery but criticized the rest of the album's overlong, generic teen pop content and sounding similar to other girl groups.

[3] AllMusic's Stephen Thomas Erlewine gave a mixed review of the record, praising the good-sounding production and decent vocal performances but felt that it overstayed its running time and made the girls feel like non-entities on their own record, concluding that "what separates the good from the great is personality, which is lacking on the otherwise adequate It Was All a Dream.

"[2] A writer for People found the album's adult content off-putting due to the band members' ages and preferred the tracks "Mr. Telephone Man" and "How Long" for being more age-appropriate for the girl group.

But two qualities set Dream's debut apart from the crowd: a lack of timeliness and the involvement of Sean "P. Diddy" Combs.