A “pipe dream” is an unrealistic desire or a fantasy, originally brought on by using an opium pipe. “Opium-pipe dream” was printed in The Morning Post, (London, UK) on October 24, 1861. “With the help of his opium pipe, dream happy dreams” was printed in The Globe (London, UK), on February 24, 1886.
   
“It (aerial navigation—ed.) has been regarded as a pipe-dream for a good many years” was printed in the Chicago (IL) Daily Tribune on December 11, 1890.
 
   
Wiktionary: pipe dream
Etymology
From the fantasies experienced when smoking an opium pipe.
Noun
pipe dream (plural pipe dreams)
1. (idiomatic) A plan, desire, or idea that will not likely work; a near impossibility.
 
(Oxford English Dictionary)
pipe dream, n.
originally U.S.
An unrealistic or fanciful hope or scheme; a ‘castle in the air’.
1890   Chicago Tribune 11 Dec. ii. 9/3   It [sc. aerial navigation] has been regarded as a pipe-dream for a good many years.
1904   B. von Hutten Pam 238   Look at the sea, and tell me if, in your wildest pipe~dream, you ever saw anything lovelier.
     
Newspapers.com
24 October 1861, The Morning Post, (London, UK), “France,” pg. 5, col. 1:
... reads more like an opium-pipe dream than [illegible word—ed.] conceived resolution.
   
British Newspaper Archive
24 February 1886, The Globe (London, UK), “Exotic Verse,” pg. 1:
... calls shirt, and looking forward to the hour of repose, when he may lie back on his conch and, with the help of his opium pipe, dream happy dreams of his far-off but ever-beloved Land of the Sun and the Peacock.
 
Newspapers.com
23 April 1887, Chicago (IL) Tribune, “Photographic Wonders,” pg. 12, col. 4:
WATER-PIPE DREAM.
(An illustration. The meaning is unclear.—ed.)
       
Newspapers.com
11 December 1890, Chicago (IL) Daily Tribune, “Building Airships of Aluminum,” pg. 9, col. 6:
“When a man begins to talk about aerial navigation,” said E. J. Pennington of Mount Carmel, Ill., at the Grand Pacific yesterday, “he just might as well own up that he is crazy and a fit subject for the strait-jacket. It has been regarded as a pipe-dream for a good many years, yet people don’t seem to be aware that it is an accomplished fact, and has been since 1852.”
   
Newspapers.com
25 November 1894, The Sun (New York, NY), “Early Throes of Reform,” pg. 7, col. 1:
In the Second district around Chinatown they have a name for stories like this. They call them “pipe dreams.”
 
OCLC WorldCat record
The Pipe Dream. A Descriptive Rag-Time Selection. (Arr. by W.H. Tyers.) [P.F.].
Author: Mose Gumble; Wm H Tyers
Publisher: Chicago, etc : Shapiro, Bernstein and Co, 1903.
Edition/Format:   Musical score
   
OCLC WorldCat record
Collier’s methods exposed. : Pipe dreams versus facts - the deadly parallel.
Author: A H Ohmann-Dumesnil
Publisher: St. Louis, Mo. : The St. Louis Medical and Surgical Journal, 1906.
Edition/Format:   Print book : English
 
OCLC WorldCat record
“A pipe dream!” (somewhere in France).
Author: Arthur Butcher
Publisher: [approximately 1914 - ca. 1918]
Series: Shirley Jones collection of military postcards.
Edition/Format:   Image : Graphic : Picture : Artwork reproduction : English
Summary:
Drawing of soldier sitting smoking a pipe, the image of a woman forming out of the smoke. Title printed below image.
 
OCLC WorldCat record
Pipe-dream blues
Author: Spencer Williams; Marguerite Kendall; J Russel Robinson; Standard Photo Eng. Co.,; Rayner, Dalheim & Co.,
Publisher: Fine Arts Bldg., Chicago, Ill. : Lee S. Roberts, [1918] ©1918
Series: American Melting Pot Collection.
Edition/Format:   Musical score : English