You're not dreaming--a mattress price war has broken out in the Washington metropolitan area.

Shops selling bedding--popularly called sleep shops--hoping to hang onto their market share and perhaps even increase it, have launched a blitz of print and electronic advertising that features a wide array of bedding at bargain prices--brand-name twin mattress pieces for as little as $49 each when purchased as a set; free bed frames with each matching set sold; reductions of up to 50 percent on many major brands.

In addition to price promotions, the advertisements exhort customers to "Rest assured . . . " and to "Have a good night's sleep on us."

"We're rocking and rolling," said Fred McMillan, manager of the Mattress Discounters' Falls Church store, one of 23 operated by the chain in the Washington metropolitan area.

"It's just like the old gasoline wars," said Bill Hurd, owner of Slumberland, an independent company with one store in Riverdale and one in Falls Church.

But the intensity of the competition, which has been building in recent weeks as stores have become more aggressive, has another side.

Consumers and shop operators complain that "fake" chiropractic mattresses are being sold, and that "bait-and-switch" tactics are being used by some mattress stores to lure in consumers, who then are urged to buy other mattresses because advertised goods aren't available.

"It has become a nightmare," said Erwin H. Mack, owner of Denis Sleep Shop at 7681 New Hampshire Ave., Langley Park. Others outraged by the bait-and-switch behavior by some stores include the Sealy Mattress Company, which last week paid for a public service announcement in the Montgomery County Journal, telling consumers that "Most retailers are happy to sell what they advertise" but warning, "Unfortunately, some stores don't operate that way."

Consumers and shop operators also complain that regular prices are being inflated and then appear to be dramatically reduced for a special sale. "The real list may be $720, but they say it's $1,000 and that they are selling it for $599," said Tom Long, the grandson of C.B. Long Son and Grandson Inc., an Arlington bedding shop founded in 1901.

And, in the heat of competition, one mattress store company has sued another. In a lawsuit filed in Virginia, Steele-Lee Inc., owner of the Mattress Center, alleged that the "chiropractic mattresses" sold by Lee's Mattresses & More, a new six-store chain with stores in Virginia and Maryland, didn't meet minimum standards established by the American Chiropractic Association--an allegation denied by Lee's.

The lawsuit includes affidavits from experts who dissected three suspect mattresses and one box spring and concluded that the filling, springs assembly and border eyelets didn't live up to specifications. Lee's Mattresses says that its chiropractic mattresses do meet the standards. The case is pending in Arlington Circuit Court.

Despite such pitfalls, consumers who need to buy new bedding should be able to find good deals if they shop carefully and buy from reputable dealers, according to industry officials here.

"It's a buyer's market," said Stuart Bannett, vice president of operations for A.W. Industries, which has Serta mattresses as one of its divisions.

"But the more shopping consumers do, the better off they will be," he said. "They shouldn't take the word of the first store they talk to. They should talk to a department store, a specialty shop, a chain store, and judge the character of the person with whom they are dealing."

Mattress industry officials say that the mattress war in Washington sprang in large part from the proliferation of bedding shops.

"There are more mattress retailers today in Washington than two or three years ago," said Fred Rohe, vice president of sales for Sealy Mattress Co. of Maryland and Virginia. "And as you increase stores in any market area, it becomes more a battle for survival as they compete for the consumer's dollar."

Why has Washington attracted so much bedding business?

Slumberland's Hurd, here for 15 years, says the constant flow of newcomers settling into new jobs and new households here creates a strong demand for mattresses. "People usually buy mattresses when they move to a new location, and we have a stream of people moving into this area all the time," he says.

Hurd says that a top-quality mattress can last as long as 15 years but a cheap mattress only about one year. "You know you need a new one when your back starts hurting," he says. "Or when two people roll into the middle of the bed together without intending to."

Based on industry figures, Washington metropolitan area customers buy about 1 million mattress units a year--spending $50 million to $55 million. Most of them are made here by regional factories, many of them located in Baltimore. One is the Serta factory, which turns out an estimated 3,000 mattresses a day.

About half of the mattresses purchased by Washington-area consumers are bought from department stores. The other half are bought from the area's 150 specialty sleep shops operated by independent retailers, including those with one or two locations and the three major chains with multiple outlets--Mattress Discounters, Mattress Center and Lee's Mattresses.

It was Lee's entry into the market earlier this year that is thought to have triggered the current price war. Lee's was formed by Elie Saliba, who was a partner in the Mattress Center with Ed Steele until 1982.

Shortly after selling out to Steele, Saliba opened the American International Mattress factory in Baltimore. Then, a few months ago, he launched the Lee's retail stores.

"They Lee's came in very aggressively and started price cutting and advertising heavily. We all had to reduce our prices, as a result," Hurd said.

Sanford Awner, an assistant to Saliba, says Lee's has simply been trying to "chisel out a niche for ourselves in the market . . . what we're looking for is our market share."

In trying to capture that share, through advertising and promotions of a variety of mattresses, including the Springwall Chiropractic mattress, Saliba attracted the attention of Steele, his former partner.

Steele sued Saliba on July 15 in Arlington Circuit Court, asking for an injunction to keep Saliba from continuing to sell chiropractic mattresses that Steele alleges don't measure up to the standard.

Awner said, however, that Lee's mattresses do measure up to standards.