The Dreamy Effect Look in Photoshop
Step 1:
Open a photo you want to edit into Photoshop. This effect works well with portraits and landscapes. To open a photo, go to File> Open and browse for the photo you want to edit.
Step 2:
We begin this tutorial by duplicating the layer. This effect will appear on its own layer so you always have a backup copy of the original image in the “Background” layer. To duplicate the layer, press Ctrl+J or go to Layer>Duplicate Layer. You should now have a new layer called “Layer 1″.
Step 3:
Now we’ll use the Threshold tool. Go to Image>Adjustments>Threshold. The Threshold tool will create a high contrast black and white effect that’ll separate the lights from the darks.
In the Threshold tool, move the middle slider around to get the effect you want. Move it to the left to make the image lighter or move it to the right to make it darker. It’s important that if you have any faces in your photo, that they be visible. For example, the image I used for this tutorial, I had to brighten the image to a threshold level of 81 to reveal the face. This rule applies for other important objects you may have such as animals, logos, and other objects you want to be visible.
Step 4:
In the Layers pallet, change the blending mode to Overlay. You should now see this nice posterized effect. I’ve seen in a few forums many people using this effect and if you like this, you may keep it like this and end this tutorial. But if you want a softer, less pop-art-like effect, continue with the tutorial.
Step 5:
To make the effect less pop-art looking, we’ll use the Gaussian Blur filter. This filter will blur the layer so that the edges between the blacks and whites aren’t so hard. Go to Filter>Blur>Gaussian Blur.
In the Gaussian Blur tool, you can adjust the radius of the blur. This will specify the amount of blurring. You can set this to a very high amount to minimize the contrast or use a lower amount such as the setting I used in the image below. Using a small number will create a high contrast effect. It’s up to you whether you want a high contrast effect or not. Some people don’t like the effect if it’s too strong so they use a large radius such as 250, but others like it and use a small number. I’m going to use a small number for this step.
I find the effect way too high in contrast and too many parts of the photo become black and hidden. To fix this, I’m going to reduce the opacity to the amount that looks right. Do this with your photo too and see if you like the effect. You don’t have to lower the opacity if you think it looks nice at 100%; it’s all up to your personal preference.
Now, here is original image:
Click to enlarge
And this is the final image:
Click to enlarge
If you like this tutorial or you are about to use it, feel free to write some comments. 
