To dream of castration represents feelings about having permanently lost courage or an ability to stand up for yourself. An inability to be assertive or mean. Accepting a passive role. Feeling that you have “lost your nerve.” Feelings about bullies in your life having effected you emotionally. A lost sense of virility. Embarrassment that you look like a wimp to other people.
To dream that you have castrated a person or animal may reflect feelings about having pacified a situation. Teaching a jerk a lesson. Preventing a jerk from causing more problems. Making sure someone never stands up for themselves in your presence again. Embarrassing your enemies by making them look like wimps.