The Dream Palace serves as a resting place for the Dream Rod. Here, Kirby can summon Dream Friends returning from previous Kirby titles as friends in the Story Mode. The Dream Palace can only be entered if you the player has pressed a certain big switch in a previous level; the first opportunity to do so is the big switch in Donut Dome.
Each Dream Palace can only be used once, and after that, access is blocked until Kirby completes another stage. At that point, the Dream Palace opens up again. However, it is possible to visit Dream Palaces in other Worlds to acquire more Dream Friends.