Vaermina

Vaermina is one of the seventeen most powerful Daedra known as Daedric Princes. Her primary sphere of influence is generally considered to be nightmares and psychological terror or torment.

Appearance
Vaermina's physical appearance is usually that of a female mage, complete with a flowing robe with deep arms, and a magic staff. She lords over the Oblivion plane of Quagmire, which is described as a constantly shifting nightmare realm. She is one of the Daedric Princes that is consistently depicted as evil or demonic, with a strong preference for psychological torture. At the same time, Daedra worshippers will often pray to her just before bedtime, likely in hopes of warding off any potential meetings during their rest.

Vaermina is often said to be strongly connected with Magnus, the source of magic on Tamriel. Many scholars believe that, through their dreams, even otherwise magically untalented mortals can slip into Quagmire, and behold Vaermina's presence. Upon speaking to her, Vaermina will explain that mortals visit her constantly in their nightmares, speak to him in their sleep, and often wake in a cold sweat upon leaving his presence. Most mortals are unaware of this meeting, however, as they cannot remember anything that occurred during their dreams. After a true, remembered encounter with the Daedric Lord, her followers often claim that nothing on Nirn holds any fear for them, as nothing can possibly be as frightening as being in Vaermina's presence.

Vaermina does not appear much in the lore of Tamriel, with one notable exception. When seeking a cure for vampirism on Vvardenfell, in The Elder Scrolls III: Morrowind, Vaermina is named as the source of Molag Bal's information on how to cure the disease.

Quest (Elder Scrolls IV: Oblivion)
During Vaermina's quest, the player gets a first-hand look at his penchant for psychological terror. To even speak to the Daedra, you must present a black soul gem, a device whose purpose is to trap a human soul. You are then tasked with retrieving an artifact stolen from Vaermina by a wizard.

When you track down the wizard's hideout, you enter a nightmare world full of lesser daedra and bizarre, other-worldly scenery. Some portions of the wizards tower resemble the Deadlands, including the ever-present lava and claw-like bridges. Vaermina's final warning to you strongly implies that he, not the wizard, is responsible for the state of the tower. The wizard himself is found comatose, nearby Vaermina's precious Orb. Upon returning his property to him, the Daedra tells you that the wizard will be trapped in his nightmare forever, as punishment for his theft.

Vaermina rewards you with the Skull of Corruption, a staff capable of creating a nightmare double of any humanoid creature, which automatically attacks the original being with a vengeance.

Appearance in Skyrim
In the town of Dawnstar, the Dragonborn will encounter - either at the inn or outside of it - a couple of citizens speaking with a robed man, complaining to them about their horrific nightmares. The man, named Erandur, seems to know something about the situation, but will not fully explain what it is when he's approached by the hero. The man claims to be a Priest of Mara, and that he can indeed remedy the situation, but he'll need the hero's help. He then leads the hero to a tower overlooking the town. Upon reaching the tower, the priest explains that the tower used to be a shrine dedicated to Vaermina. Long ago, a band of Orcs invaded the tower and had a bloody conflict with all those dwelling inside. As a last-ditch effort to prevent the Orcs from seizing the inner sanctum in which the Skull of Corruption stands, the priests release the Miasma, a gas which instantly puts all those who inhale it into an unbreakable deep hibernation while also keeping those slumbering perfectly preserved.

Unfortunately the longer one stays asleep due to the Miasma, the more their mind breaks down. As such, upon entering the tower and breaking the air-tight seal, the Miasma recedes, allowing the Orcs and priests to awaken and begin attacking in a frenzy. Upon entering the shrine, the priest explains to the hero how the Skull is the source of everyone's nightmares since it devours dreams and memories for Vaermina to collect. Along the way to the inner sanctum, the hero must drink a special potion in order to get past a magical barrier. This potion allows him/her to enter a set of being called The Dreamstride. In theory, this allows someone to physically teleport across great distances. Any who drink it instantly fall asleep and enter a dream-like world of the memories of someone nearby. Where they are in the world inside The Dreamstride is where their physical body will awaken in the physical world. As such, the hero visits the memory of a Priest of Vaermina on the day that the Orcs invaded, allowing the hero to witness as this priest runs to the device that sets up the barrier and releases the Miasma. Upon doing this in the dream, the hero awakens in the physical world, looking at the barrier control device (a soul gem).

Having circumvented the barrier, the priest and the hero make their way into the inner sanctum where they find two of the priest's former companions. Upon defeating them and having the Skull within your sight, Vaermina's disembodied voice speaks out, telling the Dragonborn that the priest is trying to deceive him/her, and that he/she should kill the priest and claim the staff for his/her own. If you let the priest finish the ritual he won't turn against you and you may recruit him as a companion.

Miscellaneous
In The Elder Scrolls V: Skyrim, The Book of Daedra, has her name spelt incorrectly as Vaernima.