A 2018 study of 210 students found that dreams of teeth falling out went with dental irritation (tension in the teeth, gums or jaw on waking) and were unrelated to psychological distress. The authors concluded their results do not support the idea that the dream symbolises anxiety or loss. About one in five students in another large survey said they had ever had the dream.
Rozen and Soffer-Dudek (2018) asked 210 Israeli undergraduates about their dreams, their wellbeing and their teeth. Teeth dreams "were related to dental irritation (specifically, tension sensations in the teeth, gums, or jaws upon awakening)" and "were unrelated to psychological distress, whereas other dream types were".
The results "do not support the symbolic hypothesis", the popular idea that losing teeth in a dream stands for anxiety or loss. This was one correlational study in students, so it shows what the dream went with, not what causes it.
How common is it?
In the Typical Dreams Questionnaire study of 1,181 Canadian students (Nielsen et al., 2003), 18.8 % said they had ever dreamed of their teeth falling out or of losing their teeth.
What it does not mean
Dream dictionaries say teeth dreams mean anxiety or loss. In the one study that tested the symbolic idea directly, the dream didn't go with distress at all.
Questions
What does it mean when you dream your teeth are falling out?
In the study that tested it, the dream went with physical tension in the teeth or jaw on waking, not with psychological distress. It doesn't support a fixed symbolic meaning.
Are teeth dreams caused by stress?
The 2018 study found they were unrelated to psychological distress. It was correlational, so it can't prove a cause either way.
How common are teeth-falling-out dreams?
About one in five students in a large survey said they had ever had one.
Sources
Rozen, N., & Soffer-Dudek, N. (2018). Dreams of teeth falling out: An empirical investigation of physiological and psychological correlates. Frontiers in Psychology, 9, 1812. https://doi.org/10.3389/fpsyg.2018.01812
Nielsen, T. A., Zadra, A. L., Simard, V., Saucier, S., Stenstrom, P., Smith, C., & Kuiken, D. (2003). The typical dreams of Canadian university students. Dreaming, 13(4), 211–235. https://doi.org/10.1023/B:DREM.0000003144.40929.0b
73.8 %of students said they'd dreamed of falling
81.5 %said they'd been chased: the top dream of 55
67.1 %said they'd dreamed of school or studying