In a colonial society, one way to compensate for lack of power is to dream. But dreams are also a source of power and a shaping force in its use, if enough people share the dream. This is the central statement of "Dream on Monkey Mountain", a very ambitious play by Derek Walcott, which is playing at the New Back Alley Thursdays through Sundays until Dec. 9.

It is a kind of play often written by poets (Walcott is the poet laureate of Trinidad and one of the Caribbean's most distinguished poets). It is too long, loosely organized and specialized in interest for commercial success in this country, but striking in its use of language, fresh and original in its ideas and symbolism.

The play is the story of Makak, a charcoal-burner, old and objectly poor, who has seen a vision and does not know what to do about it. The vision is that of a moon goddess, who tells him of his proud past in Africa and his great potential as a leader of men. The practical consequence of the vision is that Makak lands in prison, charged with disturbing the peace.

But as he tells his dream to others -- his friend Moustique, fellow prisoners, and Corp. Lestrade, a prison guard who embodies first the sprit of colonialism and later that of black power -- the dream is strangely transformed from a kind of contemplative ecstasy into various quests for wealth, political or religious domination, and finally racial supremacy -- a variation in which Makak has to kill his goddess because she is white.

The play is staged with minimal scenery but evocative Caribbean atmosphere, including music as well as costume and dialogue. Particularly fine performances are given by Keith Johnson as Moustique and Leslie Howard as Corp. Lestrade.Raymond Green in the role of Makak faces a varied set of challenges -- the character must be a drunken derelict, a sort of Don Quixote and a spellbinding rhetorician -- and he may be overdoing the rhetoric for some tastes.