Three hundred and eighty-six participants were interviewed about their experience of dreams that seem to predict an event in the future, and their belief about whether such dreams can be explained naturally or paranormally. For those without university education, participants who had had a dream that seemed to predict the future (termed experiencers) and believers in paranormal explanations for such dreams (termed believers) made more errors on a probabilistic reasoning task about a lottery. Contrary to the chance baseline shift hypothesis experiencers and believers did not give lower estimates than non-experiencers and non-believers for the frequency with which others would answer three simple personal questions affirmatively. However, they were more likely to answer the three simple personal questions affirmatively about themselves than were non-experiencers and non-believers, which suggests an affirmative bias. This affirmative bias either affects paranormal experience and belief, or is a confound in the methods used in assessing experience and belief. Copyright © 2005 John Wiley & Sons, Ltd.