Current Psychiatry has an article about Alien Abduction Experiences, which can be caused by several pscyhiatric and neurological conditions. Some cases are hypothesized to be secondary to sleep paralysis combined with hypnagogic or hypnopompic hallucinations:
Full-body paralysis normally accompanies rapid eye movement (REM) sleep, which occurs several times a night. Sleep paralysis is a transient state that occurs when an individual becomes conscious of this immobility, typically while falling asleep or awakening. These experiences can be accompanied by hypnagogic (while falling asleep) or hypnopompic (while awakening) hallucinations. An estimated 30% of the population has had at least one sleep paralysis episode. In one study, 5% of sleep paralysis patients had episodes that were accompanied by hallucinations.
During sleep paralysis episodes, individuals typically sense a threatening presence. Patients have reported beastly and demonic figures of doom: devils, demons, witches, aliens, and even cinematic villains such as Darth Vader and Freddy Kruger. Others have described this presence in terms of alien visitations or abductions.
Sleep paralysis and associated hallucinations can sometimes be treated by treating any underlying sleep disorders. Treatments for cataplexy, such as tricyclic antidepressants, are often effective for sleep paralysis.