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Are there any differences in the meaning of or when we use the idioms 'work like a dream' and 'work like magic'? The definitions in the Cambridge Dictionary are:

- work like magic: to be very effective, possibly in a surprising way

- work/go like a dream: to work or go extremely well, without any problems

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I doubt many (if any) people would interpret an utterance differently depending on whether it included [worked] like a dream or like magic. But it's worth noting that neither version is anywhere near as common as like a charm...

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The dictionary does show the difference: in a surprising way.
In both cases the result was good; the difference is in the expectation.

  • like magic – possible snags and problems didn't happen

  • like a dream – just as hoped for

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