To dream of dead people may suggest a link of a spiritual nature to our long-forgotten ancestors, and may deal with family patterns of belief. Loved ones who have died appearing in dreams show that the veil between this world and the next is very thin.
Psychological / Emotional Perspective:
Memories can remain buried for years and often when people who have died appear in dreams, we are being reminded of different times, places or relationships which will help us to deal with present situations.
Everyday Material Aspects:
Dead people we have known appearing in dreams usually refer back to strong emotions we have had about those people, whether they are negative or positive. For instance, there may be unresolved anger or guilt we still hold and the only way we can deal with it is within a dream sequence.
Also consult the entries for Death and Hearse.