decides not to go further with the "devil" and sits on a stump

applauding himself greatly, and thinking with how clear a conscience he should meet the minister in his morning walk, nor shrink from the eye of good old Deacon Gookin. And what calm sleep would be his that very night, which was to have been spent so wickedly, but so purely and sweetly now, in the arms of Faith! Amidst these pleasant and praiseworthy meditations...

Because we have an image of Goodman Brown sitting and thinking, it is possible that he was not only meditating, but falling asleep. The events that take place after could be a dream.

Hawthorne, though, purposefully keeps this ambiguous. He does not tell us whether it's a dream and even mentions that it may or may not be at the end of the story. He writes, "Had Goodman Brown previously fallen asleep in the forest and only dreamed of a wild dream of a witch-meeting? Be it so if you will..." He leaved it to the reader to decide whether it is a dream, and asks the reader to take from it the moral lesson- that any man can be infected by sin.

Actually, I don't think there is sufficient evidence from the text to argue that Goodman Brown actually believes the dream to be true. I think it is clear that if we read the text, we are not actually told if what Goodman Brown saw was real or not. What is clear though, is that seeing what he saw impacts Goodman Brown for the worse, and changes him from that point forward. Let us note the way that the vision ends:

Whether Faith obeyed he knew not. Hardly had he spoken when he found himself amid calm night and solitude, listening to a roar of the wind which died havily away through the forest. He staggered against the rock and felt it chill and damp, while a hanging twig, which had been all on fire, besprinkled his cheek with the coldest dew.

It is thus left deliberately vague whether Goodman Brown experienced a dream from which he suddenly awoke, or whether he experienced reality and then was transported away from it. The text deliberately tantalises us with both possibilities. Note the way that the narrator rather cheekily asks us the following question:

Had Goodman Brown fallen asleep in the forest, and only dreamed a wild dream of a witch-meeting?

This question is never answered, but the way in which Goodman Brown's life is changed by what he witnessed and the way that it obviously showed him that evil is present in all of us is explored in great detail. What he saw, fact or fiction, was enough to profoundly challenge his belief in the goodness of humanity, leaving him a joyless man.