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In the near future, a revolutionary new psychotherapy treatment called dream therapy has been invented. A device called the "DC Mini" allows the user to view people's dreams, exploring their subconscious thoughts. The head of the team working on this treatment, Doctor Atsuko Chiba, begins using the machine illegally to help psychiatric patients outside the research facility, using her alter-ego "Paprika", a persona she assumes in the dream world. The movie opens with Paprika counseling Detective Toshimi Konakawa, who is plagued by a recurring dream, the incompleteness of which is a great source of personal anxiety for him. This type of counseling session is not officially sanctioned, so Doctor Atsuko Chiba and her associates must be cautious that word does not leak out to the press regarding the nature of the DC Mini and the existence of Paprika. Her closest ally is Doctor Kōsaku Tokita, a child-at-heart genius and the inventor of the DC Mini. Unfortunately, before the government can pass a law authorizing the use of the device, three of the prototypes are stolen. Because of their unfinished nature, the DC Minis can allow anyone to enter another person's dreams, giving the culprit an opportunity to get away with all sorts of malicious deeds. Almost immediately, the chief of the department, Doctor Toratarō Shima, goes on a nonsensical tirade and jumps through a window, nearly killing himself.