I'd like to audition in a local theater, but I can't even act in front of my family.Should I drop my dream?

Get involved with a local community theatre and learn the ropes. 

There are many aspects of storytelling on-stage - tech work, making sets, scenery and costumes, play-readings, directing the plays, etc. and most local theaters are run by volunteers, so they will welcome you.

You will learn some skills and get to know some actors who are doing it - they will have stories to tell about their lives on-stage and share tricks of the trade.Once you feel "in the know" it will be easier for you to get up there and do it yourself. Many theaters have an annual festival of short and/or original plays, so maybe you could be involved with one of those instead of having to carry a whole show to start.

Yes, drop this dream

 A LOT of performers feel funny opening up this different side of themselves to their family but have no problem at all auditioning or performing for strangers who they will either never see again (if they do not pass the audition) or who have let them know they have talent (if they pass the audition).  

No

you should step out of your comfort zone and Just Do It

You should drop participating in Yahoo Answers. Your questions are all awful.

Rather than drop your dream why not identify the steps you need to get there?  

Going to an audition now with zero confidence will only set you up for failure.  Find basic acting classes first.  If those seem too challenging, start with basic public speaking.  

Too often, people give up on their dreams due to impatience or inability to mark out a clear path to achieve them.

You really should start by taking some acting classes to see if you even like acting.

Acting isn't just getting up in front of people  it involves a lot of work before you get to that point.  If you "can't even act in front of your family" then no way are you ready to audition.

The reality of acting is not just being on stage, you need to have talent and training to even know if a "dream" has the potential to be anything more than that.

Some actors were shy starting off, or lacked confidence -- you can audition, but don't expect miracles because in acting, many try out, but few are chosen.