What are your feelings towards him?
As for him stopping and looking at you, he's probably puzzled why
you are tense around him and seem embarassed and don't want to talk
to him.
Some guys may be insensitive barbarians sometimes, but some of us
guys can pick up when something's amiss.. like your being tense and
being afraid to talk to him... and even if he's not conscious about
it, he'll feel that something's amiss.
Maybe, you gotta psyche yourself up to speak to him? After a while,
the tension will ease and you'll not think about the erotic dream
anymore?
Also, you don't have to tell him 
unless you want
to 
