You can be quite aware, but admittedly it isn't exactly the same as being awake. Your level of consciousness can vary but to acheive the highest level of awareness it helps to shout commands such as "Increase lucidity now!" and similar methods. I think thinking about waking life briefly will also help, such as what you are going to do the next day. I haven't experimented much with this and it may probably in turn just wake you up or shorten the dream.
Practice does make help though and I hope that with a lot of dedication it is possible to acheive such states.
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