Macbeth's Paranoia
This soliloquy captures Macbeth's mental and emotional condition at this particular time of the play. He begins with the line, "Is this a dagger i see before me?" referring to a hallucination he is seeing of a dagger with its handle toward him. It is clear that Macbeth's ambition is pushing him over the brink of insanity. The dagger's appearance can be viewed ambiguously; is it an omen that Macbeth should proceed, or is it a final warning of his conscience?
The irony of the hallucination of the dagger is that it proves that Macbeth does indeed have moral scruples. The strength of Shakespeare's characterisation of Macbeth is that he is not a cold hearted killer but a man who has a conscience which is fighting against his ambition. Macbeth recognizes his own insanity when he says, "...art thou but A dagger of the mind, a false creation, Proceeding from the heat-oppressed brain?" The darkness of the imagery and symbolism of a supernatural bloody dagger drawing him on represent his awareness of the horror of this regicide and the psychological forces of evil which are driving him (including the witches and his wife). Macbeth alludes to the darkness of his own heart when he says, "wicked dreams abuse The curtain'd sleep...", again recognizing the wrongness in his own deeds.
The second half of the soliloquy, which begins with him rejecting the hallucination (“There’s no such thing: / It is the bloody business which informs / Thus to mine eyes”), shows Macbeth using the context and atmosphere of the night to externalise his inner demons, to the point of even calling upon the earth to ease his anxiety (“Thou sure and firm-set earth, / … / … take the present horror from the time, / Which now suits with it”).
What is probably meant to shock audience the most is the fact that, despite Macbeth's recognition of all his flaws and sins, he still goes goes through with his plan. Guilt and insanity are all weighing down on him hard, but he musters up the resolve, follows his hallucinations and murders Duncan. The last vestiges of the honorable Macbeth die at the end of this speech. It is a fleeting match between Macbeth's ambition and revulsion. The bell ultimately tolls for Macbeth as it does for Duncan; the dagger of the mind is as potent a killer as the dagger Macbeth wields in murder.