What is the significance of the title of the poem ''Kubla Khan''?

The title of the poem, the alliterative name of a Chinese ruler, immediately establishes a connection with the Orient. As Edward Said argued in his book Orientalism, in the eyes of the western world, the Orient was not a real place but  a mental construct that lumped dozens of disparate and geographically widespread cultures under one name and characterized them in opposition to the West. If the West was supposed to be the place of rationality, masculinity, concreteness, adulthood and practicality, the "Orient" was the land of enchantment, exoticism and dreams. 
Coleridge, an opium addict, insisted his poem arose from a dream. The poem reflects a Westerner's fantasy of the "Orient" as sensuous dreamscape: it is not about the ruler Kubla Khan, per se, but about the imagined landscape he inhabits: his pleasure dome, the scent of his "incense-bearing tree," "A Savage place!" both "holy and enchanted," inhabited by a "damsel with a dulcimer," where a waterfall crashes into the sea, a place both alluring and dangerous ("Beware"). The title thus signals the move from the rational world of the West into the dreamscape of the Other. 

Samuel Taylor Coleridge's poem "Kubla Kahn" is named after a real Mongolian general who conquered China and lived on an elegant estate. This reference is highly significant for a couple of reasons. First, by naming his poem after a real Mongolian conqueror, Coleridge signifies that the topic of the poem (Xanadu, the pleasure dome) is meant to evoke images of China and the Far East. For English readers during Coleridge's day, this location would have been very exotic, and so Xanadu would have accordingly seemed to inhabit a fairy-tale realm. Additionally, by naming his poem of artistic creation after a highly successful conqueror and ruler, Coleridge also comments on the nature of creativity and imagination. If the real Kubla Kahn unified and ordered a vast realm, then the Kubla Kahn of the poem and his creation of Xanadu should be seen in a similar fashion. In other words, Coleridge's Kubla Kahn is not merely creating a pleasure dome; rather, he's ordering space and creating an organized system where there was formerly chaos. Thus, by basing his poem on a real Mongolian leader, Coleridge signifies that his Kubla Kahn not only occupies an exotic, otherworldly realm, but that his artistic creation is an essential ordering force that can unify and control many disparate components.