A dream with an onion represents the various layers or your personality or a part of your life.
Pealing an onion in the dream suggests that you need to look at the various parts of your character or a situation in your waking life. The peeling process depicts the process required to get to the bottom of something, such as a problem you are facing. You need to dig a little deeper than you currently are.
An onion can also suggest that you have built up emotions of sadness that need to be released through crying.