The game originated from concepts several individuals made during a Sonic-themed Valentine's Day event on the game-sharing website Glitch City.

Sonic Dreams Collection quickly caught the attention of many video game journalists, who were intrigued by its absurd nature and content.

They characterized the game as scary and bizarre, but considered it a work people should be interested in playing and noted its commentary on the series' fandom.

[14] The site contained a press release in which Arcane Kids claimed to have discovered the game's contents in a Dreamcast software development kit they purchased on eBay in 2013 and posted them online as a protest against Sega's apparent attempts to keep their existence a secret.

[14] Sonic Dreams Collection quickly caught the attention of video game journalists for its absurd content and intention to lampoon the series' fandom.

[5] The Daily Dot questioned why the game even existed and wrote it took the Sonic fandom's weirdness to a new level,[21] and Polygon's authors expressed concern they were not allowed to write about its contents.

They also disagreed with The Daily Dot's comment about the peculiarities of the fandom, saying Sonic Dreams Collection "isn’t even scraping the surface of the places those people go.

"[22] In addition to mocking the fandom, Engadget found the game served as a comment of the state of the Sonic franchise and its sullied reputation.

[10] Engadget wrote players would finish Sonic Dreams Collection within minutes but that they would likely come back, finding it "uncanny at recreating both the vibe of crude fan art and Sega's turn-of-the-century zeitgeist, that sense that the Dreamcast would usher in a brave new era for the blue hedgehog and his friends.