Nightmare

Nightmare is a bit derogative way of referring to the strongest among the demihumans. It's a category (and also a profession, in a way) that puts them as equals of magisters, heresiarchs and Terminal-Stage warlocks.
Nightmares are not only capable of casting some of the most powerful magic of their Lore, but also have their physique improved to the peak of their species. Anything their kind can naturally do, they will even better. To defeat one is a notable feat.

Career

Qualifications

Each and every demihuman is born with certain quality to them, depending on how much effort did their creator Power put into their creation. This defines how strong can they grow, typically by limiting the highest level of magic (and the number of it) that they can learn. Majority of demihumans hit their limit at anywhere between tier three to tier seven magic. This is not enough to become a Nightmare.
To actually succeed in that, one needs to reach a level of quality that lets them cast spells of at least tier nine (although you can expect your status to be questioned by some unless you can cast the tier 10 magic). This requires scoring a good roll at the initial transformation/genetics (it's almost unheard for demihumans beneath quality level seven to reach that far, but a few times it DID happen)... and then doing it again.
You need to gather enough attention of your patron Power to score another transformation, in order to get your design flaws worked out and be updated into a proper Nightmare status. This typically requires becoming a notable person among the demihuman communities of your particular subspecies. Fame or infamy helps, and so do major achievements even if no one knows about them.

Perception

Social Status

It's fairly common for Nightmares to act as leaders and protectors of demihuman communities, thanks to their strength and prerequisite of already being someone important among their kin.