Just as a dream city vanishes on waking, so this whole visible universe vanishes the instant true knowledge dawns
The dream-city image sharpens the previous verse's claim by specifying exactly what "waking up" does to an entire world of experience — not gradual fading, but instant disappearance.
A dream city can feel completely real while the dream lasts — populated, three-dimensional, consistent — and then vanish without a trace the instant the dreamer wakes, leaving nothing behind to clean up or account for. Chapter nineteen applies this exact mechanism to the visible universe itself: it isn't that the world slowly loses its grip as understanding deepens, but that it disappears all at once in the same way a dream city does, the moment true knowledge of the self dawns. This is a stronger image than simple impermanence, since a dream city doesn't fade gradually — it simply stops having ever needed to be real. The verse asks the reader to notice that waking, not effort, is what removes a dream.
Ashtavakra Gita