I was really young so I only remember that in the first episode a group of kids get on a train then suddenly their monster avatars (in which they can transform later) appear for a split second.
The main guy gets his ability to transform first and it is some red monster I think. Then in the second episode I think they encounter in the forest they are in some kind of monster that can make you dream nightmares so it starts implanting them in every singe one of them.
I think the rival of the main kid transforms for the first time into some white cat tiger I think and that's it. I don't remember anything else but it is possibly from Japan(?).