Hermia has this dream in Act II, Scene 2. When she awakes, she says:
Help me, Lysander! Do thy best
To pluck this crawling serpent from my breast!
Ay me, for pity! What a dream was here!
Lysander, look how I do quake with fear.
Methought a serpent ate my heart away,
And you sat smiling at his cruel prey.
*Taken from Shakespeare's A Midsummer Night's Dream, published in Kennedy and Gioia in Literature: An Introduction to Fiction, Poetry, Drama, and Writing.
One of the main themes is dreams, and this is a very scary one that Hermia had. She dreamed a serpent ate her heart out while Lysander watched with delight (a smile on his face). This leads the reader to believe that on a symbolic level, this dream might represent the fear that Hermia might have if she believed Lysander loved someone else or if his love wasn't true. It would clearly break her heart. The snake could symbolize evil, as the snake in the Garden of Eden in Genesis. It could also symbolize Helena (as she is the one that Demetrius falls in love with after the potion is placed on his eyes).
Because the entire play could be a dream or perhaps only the portion about the young lovers' adentures, etc., this reinforces the theme of illusion vs. reality.