A person lies awake in the small hours, and every sound feels like a threat. The speaker keeps trying to explain the noises away: leaves or fingers on the window, a bird or something with claws overhead. Each explanation falls apart almost as soon as it's offered ("If they were lighter, it might be a bird"). Starlight, shadows and even the wallpaper seem to come alive, and the short, broken lines make the fear feel like held breath, with the warning "don't look at their eyes" adding to the dread.
The tension builds until the sudden "Ah!" when the speaker's feet touch something clammy at the end of the bed, which they take for a poisonous toad. Then comes the relief, and the joke: it's only a cold hot-water bottle. The mood shifts from creeping terror to a rueful, almost comic release, showing how an anxious imagination can turn something ordinary into a monster.