There is a state between being fully awake and being asleep that kicks my brain into overdrive. It happens at night when I'm in bed but haven't fallen asleep yet or first thing in the morning when I've just woken up. If I'm thinking about a story at that time, I'll come up with lots of great ideas for it. If I'm thinking about work (which is more often the case), it helps me figure out what I need to do for the projects I'm working on.
What is it about this state of mind that fuels creativity? As it turns out, when I did some research on it, there is a word for the period between awake and asleep: hypnagogia. It's also known that hypnagogia is wonderful for creativity. From my experience, it's true that during this state, my mind wanders all over the place, making associations that I wouldn't normally make when I'm fully awake. I think those associations are more freely made because whatever mental filters I have in place during the day have come down, allowing me to think along unconventional lines. What also facilitates creativity during hypnagogia is just the lack of distractions. During the day, I'm constantly aware of my surroundings and trying to multi-task. But when I'm falling asleep or just waking up, the environment is quiet. The reason why I believe distractions play a part is that if I'm falling asleep when there are things happening around me, I don't enter that creative state. I just go from awake to asleep or vice versa.
Here is an article that teaches you how to enter hypnagogia. I haven't tried the suggestions yet, but I prefer doing it the old-fashioned way. Just give me more opportunities to sleep!