McPhee died May 8 at his Woodland Hills home of the neurodegenerative disease also known as amyotrophic lateral sclerosis, his family said.
With a background in sociology and sleep disorders, McPhee began interpreting the dreams of callers in 2000 on KRUZ-FM (97.5) radio in Santa Barbara.
By 2003, he was hosting "The Dream Doctor Show," a syndicated radio program that eventually aired in about 25 markets, including KZLA-FM (93.9) in Los Angeles.
"Dreams are always looking out for your own best interests," he told NBC in 2006. "They're warning you, they're giving you information."
Callers often asked about the meaning of dreams with water and tidal waves, which McPhee said could signify large waves of emotion. Other popular inquiries centered on storms, babies, flying, teeth and snakes.
One of his "greatest strengths" was that he "had the confidence to say 'this means that,'" when most other dream interpreters would hedge, Richmond said.
When McPhee started to slur his words on the air in 2006, listeners worried that he was drunk. Instead, the speech was an early sign of the disease that would take his life.
As he began to lose his voice, McPhee ended his show and turned toward the Dream Doctor, the website he founded in 1997. On it, he built a significant database of more than 600,000 dreams that can be used for research.
"I do not want the language of dreams, which I've worked so hard to illuminate, to be lost," he told NBC in 2006.
Charles Lambert McPhee was born April 24, 1962, in Washington, D.C., to a lawyer and his real-estate agent wife and grew up in Potomac, Md.
McPhee earned a bachelor's degree in sociology from Princeton University in 1985 and a master's in communication management from USC in 1990.
His senior thesis at Princeton on lucid dreaming — in which the sleeper is aware that a dream is occurring — was the basis of his 1996 book "Stop Sleeping Through Your Dreams."
He also published a 2002 guide to deciphering dreams, "Ask the Dream Doctor," and 2005's "The Dream Doctor Diary."
After coordinating sleep research laboratories at the National Institute of Mental Health and at Cedars-Sinai Medical Center, he oversaw a sleep-apnea program at the Sleep Disorders Center of Santa Barbara in the late 1990s.
Colleagues said he was unfailingly positive, which was evident after his diagnosis. McPhee repeatedly said that he had achieved his "life's goal" of learning "the language of dreams."
He is survived by his wife, Petra, whom he married in 2000; two daughters, Celia, 6, and Ella, 8 months; his father, Henry Roemer McPhee, and mother, Joan Lambert McPhee; a brother, Roemer; and two sisters, Joan and Larkin.