Horse's ass and demon of color -- Lady Liberty's nightmare as imagined by Henri Fuseli
"Fuselis The Nightmare has no moralizing subject. The scene is an invented one, a product of Fuselis imagination ... subject is not drawn from history, the Bible, or literature. The painting has yielded many interpretations and is seen as prefiguring late nineteenth-century psychoanalytic theories regarding dreams and the unconscious ...
"The figure that sits upon the womans chest is often described as an imp or an incubus, a type of spirit said to lie atop people in their sleep or even to have sexual intercourse with sleeping women. Fuselis painting is suggestive but not explicit, leaving open the possibility that the woman is simply dreaming. Yet, her dream appears to take frightening, physical form in the shapes of the incubus and the horse. According to Fuselis friend and biographer John Knowles, who saw the first drawing Fuseli made for the composition in 1781, the horse was not present in the drawing but added to the painting later.
"Although it is tempting to understand the paintings title as a punning reference to the horse, the word nightmare does not refer to horses. Rather, in the now obsolete definition of the term, a mare is an evil spirit that tortures humans while they sleep. As Samuel Johnsons A Dictionary of the English Language (1755) defined it, a mare or mara, [is] a spirit that, in heathen mythology, was related to torment or to suffocate sleepers. A morbid oppression in the night resembling the pressure of weight upon the breast. Thus, Fuselis painting may in fact be understood as embodying the physical experience of chest pressure felt during a dream-state."
Source: https://www.khanacademy.org/humanities/becoming-modern/romanticism/romanticism-in-england/a/henry-fuseli-the-nightmare