This episode is one of my personal favorites from this series. Set some time in the future, it shows a group of soldiers involved in war with an unseen enemy ( at first ) who are captured and put into a holding area. One by one, the alien holding them takes each of them out of the area and tries to extract information via the use of a variety of torture methods. As the tension rises among the captives, they start to accuse each other of caving in to the aliens' demands. The surprise twist that is revealed near the end is given additional emphasis when the tension between the prisoners explodes into open conflict.
Nightmare is an outstanding example of what the series is trying to achieve: tell a story and make the viewer think about what they have seen at the same time. The acting is stellar and the episode, despite its basis, plays out in a way that doesn't stretch credibility too much. Highly recommended!