Nightmare's power and toughness are each equal to the number of Swamps you control.1 As the poisoned land spreads, so does the nightmare's rage and terrifying strength.
Illus. Melissa A. Benson
4/1/2008: If you control 0 swamps, then the Nightmare has 0 toughness and will be put into its owner's graveyard as a state-based action right before the next player gains priority.
10/1/2009: Nightmare's power and toughness changes as the number of Swamps you control changes.