|“||A unique and ... er ... violent species called the Toothless Daydream, distant relations of the Monstrous Nightmare, but far more ruthless and so rare they are practically extinct.||”|
The hypothetical Toothless Daydream species looks exactly like a Common or Garden Dragon. According to Fishlegs, you can point out a Toothless Daydream by the wart on its nose. Royal blooded Daydreams also start out very small, like Toothless.
|“||The Royal Daydreams tend to start out small but they grow into creatures of IMPRESSIVE - even GARGANTUAN - size.||”|
Apparently Toothless starts off small but will grow gigantic with time, which is foreshadowing because Toothless later turns out to be a Seadragonus Giganticus Maximus. In the Book series, he is also assumed to be a Common or Garden Dragon, of very small size. His hide is bright green, and, as the name suggests, toothless.
According to Fishlegs, Toothless Daydreams are very violent and ruthless.
Toothless Daydreams are a fictitious dragon species Fishlegs invented to make Toothless sound very impressive to Hiccup's father.
Hiccup continues the ruse that Toothless is a 'Toothless Daydream' species, and uses it to stoke his ego in order to get him to do what he wants. Specifically, Hiccup mentions Toothless Daydreams when trying to get Toothless to practice sniffing for treasure.
|“||You want us to show everybody what amazing sniffers Toothless Daydreams really are, don't you?||”|
|— Hiccup in Dragonese|