Lord Dunsany, far and away the most influential English-language fantasist of the first half of the 20th century, supplied a literary model for Lovecraft's in-between years. HPL's Dunsanian period moved him from verbose nods to Edgar Allan Poe and other horror writers to the cosmic horrors of the Mythos that would occupy Lovecraft from the mid-1920's to his death in 1937.
The Dunsany stories, sometimes referred to as Lovecraft's Dream Cycle, aren't strictly horror. Instead, their lapidary prose and often surreal settings aim for a more nebulous form of the Weird and the Fantastic. They are indeed dream-like at even their shortest lengths, and many of the Dream-Cycle fragments are expansions of dreams set down by Lovecraft. From Dunsany also came Lovecraft's pantheons of strange gods with stranger names, and strange places with stranger names. Dunsany helped unshackle Lovecraft from real religions and traditional supernatural menaces. Dunsany helped Lovecraft fly.
The Dream-Quest of Unknown Kadath follows the efforts of recurring Dream-Cycle character Randolph Carter to discover why he's been banished from a wondrous city he'd previously been visiting in his dreams. Yes, The Dream-Quest of Unknown Kadath is indeed set in dreams -- or "Earth's Dreamlands," as Carter would say. There are also Dreamlands on other worlds. There are also Dreamlands in the dark between the stars, but you probably wouldn't want to find out what lives there.
Carter seeks the fortress of Kadath of the Cold Wastes, where dwell the gods of Earth, who seem to have barred Carter from his Dream-City. Looming far beyond and greater than the gods of Earth are the Other Gods. These are versions of the alien 'Gods' of the Cthulhu Mythos, though only Nyarlathotep and Azathoth are named among them.
Carter will have to deal with these gods along with various monsters, ghouls, night-gaunts, cats, Gugs, almost-humans, vampires, and moon-beasts in the course of his quest. He'll meet Robert W. Chambers' King in Yellow. He'll converse with Nyarlathotep, the Crawling Chaos, herald of the Other Gods. He'll make friends and allies of the Cats of Ulthar and the ghouls of the Dreamlands. And he'll voyage through strange and mysterious lands, over weird seas, and under strange ground.
And all without chapter breaks!
Those who would come to The Dream-Quest of Unknown Kadath seeking cosmic horror in the vein of "The Call of Cthulhu" and "At the Mountains of Madness" should steer clear. There are sections of weird, unsettling description. But this novella really works best as a lengthy prose poem devoted to evoking the weird, the surreal, and the logic of dreams.
The Dream-Quest of Unknown Kadath has some tiring passages. Its diction and syntax would have been helped in stretches by serious, ruthless editing. And HPL really, really falls in love with the word 'pshent' (now generally spelled 'pschent') over the last 20 pages or so. Nonetheless, it's a rewarding text both for the devotee of HPL and the general fantasy reader. Listening to prog-rock while reading it might also be a good idea. It's pretty trippy. Recommended.