The Curious Dreamer’s Dream Dictionary

by Nancy Wagaman
Absorbing something mentally or emotionally, or the ability to do so.

“Taking something in” or learning.

“Cleaning up” after yourself or someone else (problems, neglected responsibilities, etc.).

Consider also the context and how the towel was being used (for example, drying yourself after a shower could represent the end of a process, and wiping up a spill could represent solving a problem).

See Absorbing, Cleaning, Wet, Dry, Dry Up, Dryer

The Complete Guide to Interpreting Your Dreams

by Stearn Robinson - Tom Corbett
The message here depends on the kind and condition of the towel.

If it was a clean cloth towel, it promises good health and material comfort; however, wet and/or soiled towels forecast a season of frustration, while paper towels portend a period of recession.

Islamic Dream Interpretation

by Ibn Seerin
(Apron, Serviette) A towel in a dream represents one’s servant, employee, housekeeper, or it could represent a pilgrimage to Mecca. In a dream, a towel also represents one’s wife, and for a woman it represents her husband.

If a towel is used as a mat during sexual intercourse in a dream, then it represents a discrete servant who protects his mistress’s secrets, or it could represent money that serves woman’s needs and those of her children.

To throw a towel at someone in a dream means to slam the door in his face, or it could mean separation between two people.

To throw in the towel in a dream also means to give up one’s fight.