This very important soliloquy occurs just before Macbeth goes to kill Duncan. As he dismisses Banquo and Fleance, and then his servant, Macbeth is left alone with his murderous thoughts as he contemplates what he is about to do. The soliloquy could be summarised as follows.
Macbeth is startled to see a dagger before him with its handle pointing towards his hand. He grasps at it but is unable to touch it. Macbeth wonders whether this dagger is real or just a product of his imagination, and comments that it acts as a sign to spur him on to kill Duncan. As he continues to contemplate the dagger he sees that it becomes covered in blood. Macbeth comments that this is the time of night when evil is rampant. He then implores the earth to not hear his steps in case it announces what he is doing. However, he comments that whilst he is talking, Duncan still lives and he is procrastinating. As Macbeth hears the bell tolling, Macbeth sees it as an invitation and as a sound that summons Duncan to the afterlife and whatever might greet him there.
Macbeth's soliloquy in Act II, Scene 1 introduces the phantasmagoric realm into this Shakespearean drama that has a prevailing atmosphere of darkness.
In this soliloquy of Macbeth's, a dagger appears in the darkness before him as he contemplates the regicide he is about to commit. This apparition of a dagger is the first of Macbeth's visions. He speaks to the dagger, wondering if it is real and thus, if so, he can touch it, or whether it is merely a figment of his imagination. Macbeth calls the sight of this dagger a "fatal vision" because the dagger is the same type of instrument he intends to use in order to kill King Duncan. He tries to grab the dagger, but cannot do so, although he still sees it:
Come let me clutch thee.
I have thee not, and yet I see thee still... (2.1.34-35)
Furthermore, Macbeth imagines blood on this imaginary dagger which has not been there before, and he wonders if his eyes are playing tricks on him. Then, Macbeth begins to feel that "Nature seems dead" (2.1.50) since there is an eeriness to the night. Also, Macbeth hopes that no one will hear him as he continues his evil mission. Having heard a bell toll, Macbeth responds to its "invitation" to act because the longer he speaks, the more his courage wanes. He then addresses King Duncan. He tells him not to hear this bell, since for King Duncan, it is a funeral bell that summons him "to heaven, or to hell" (2.1.65).