NREM sleep was divided into four stages in the Rechtschaffen and Kales (R&K) standardization of 1968. That has been reduced to three in the 2007 update by The American Academy of Sleep Medicine (AASM).
• Stage 1 – occurs mostly in the beginning of sleep, with slow eye movement. This state is sometimes referred to as relaxed wakefulness. Alpha waves disappear and the theta wave appears. People aroused from this stage often believe that they have been fully awake. During the transition into stage-1 sleep, it is common to experience hypnic jerks.
• Stage 2 – no eye movement occurs, and dreaming is very rare. The sleeper is quite easily awakened. EEG recordings tend to show characteristic "sleep spindles", which are short bursts of high frequency brain activity, and "K-complexes" during this stage.
• Stage 3 – previously divided into stages 3 and 4, is deep sleep, slow-wave sleep (SWS). Stage 3 was formerly the transition between stage 2 and stage 4 where delta waves, associated with "deep" sleep, began to occur, while delta waves dominated in stage 4. In 2007, these were combined into just stage 3 for all of deep sleep. Dreaming is more common in this stage than in other stages of NREM sleep though not as common as in REM sleep. The content of SWS dreams tends to be disconnected, less vivid, and less memorable than those that occur during REM sleep. This is also the stage during which parasomnias most commonly occur.

Sleep spindles are unique to NREM sleep. The most spindle activity occurs at the beginning and the end of NREM. Sleep spindles involve activation in the brain in the areas of the thalamus, anterior cingulate and insular cortices, and the superior temporal gyri. They have different lengths. There are slow spindles in the range of 11 – 13 Hz that are associated with increased activity in the superior frontal gyrus, and fast spindles in the range of 13 – 15 Hz that are associated with recruitment of sensorimotor processing cortical regions, as well as recruitment of the mesial frontal cortex and hippocampus. There is no clear answer as to what these sleep spindles mean, but ongoing research hopes to illuminate their function.

K-complexes are single long delta waves that last for only a second. They are also unique to NREM sleep. They appear spontaneously across the early stages, usually in the second stage, much like the sleep spindles. However, unlike sleep spindles, they can be voluntarily induced by transient noises such as a knock at the door. The function of these K-complexes is unknown and further research needs to be conducted.

Although study participants' reports of intense dream vividness during REM sleep and increased recollection of dreams occurring during that phase suggest that dreaming most commonly occurs during that stage, dreaming can also occur during NREM sleep, in which dreams tend to be more mundane in comparison. It was initially thought that NREM sleep is the absence of dreaming, or dreams occur more rarely compared to REM sleep because 90–95% of those who wake up in the middle of REM sleep will report that they have had a dream, but only 5–10% of those waking up in the middle of non-REM sleep will report they've had a dream. However, when asked for more general thought processes or feelings, 70% of people who awaken from NREM sleep reports of having dream-like feelings, which is characteristic of NREM dreams, potentially disproving that theory.

Research has also shown that dreams during the NREM stage most commonly occur during the morning hours which is also the time period with the highest occurrence of REM sleep. This was found through a study involving subjects taking naps over specific intervals of time and being forcefully awakened, their sleep was separated into naps including only REM sleep and only NREM sleep using polysomnography. This implies that the polysomnographic occurrence of REM sleep is not required for dreaming. Rather, the actual mechanisms that create REM sleep cause changes to one's sleep experience. Through these changes, by morning, a sub-cortical activation occurs during NREM that is comparable to the type that occurs during REM. It is this sub-cortical activation that results in dreaming during the NREM stage during the morning hours.
It is suggested that dreaming involves two selfs: aggressive self (REM) and friendly self (NREM). It seems that in NREM dreams, the self is put in different situations, largely negative, but is found to respond in a way that befriends or embraces the unfamiliar. It is sometimes thought that in NREM sleep, the dreamers are "aware of being aware", also known as "secondary awareness", which allows them to make better decisions and potentially reflect on them.