The successful coach was over the moon with his side's home victory, and feels Wednesday's encounter will be a huge confidence boost
The Germans opened the scoring via Robert Lewandowski in the first half, but Cristiano Ronaldo restored parity shortly after, meaning it was level at half-time.
Nevertheless, Marcel Schmelzer helped his side to the full three points after the interval with a well taken volley, much to the satisfaction of Klopp.
"The feeling is amazing; it was a sensational evening for us and truly the stuff dreams are made of. It was not a perfect match, but in terms of passion and fighting spirit it was quite close," Klopp stated at a press conference.
"There were spells in the first half where things didn't quite go to plan, but there is no reason to be overly critical as overall we played very well.
"It was an exceptional Champions League night.
"This game will give my players a confidence boost. They have been criticised a lot in recent weeks. If anyone doubted the character of my team, then they have lost all my respect. We always want to play well but unfortunately it's not always possible to play like we did against Madrid."
Borussia Dortmund sit first in Group D with seven points from three games.