My daughter was bit or stung by something in the middle of the night and woke with a red spot on her neck. this spot then turned into blisters. ?

Sounds like a: localized reaction to the bug bite, which is a normal reaction presenting as red spot-"inflammation".May or may not turn into blisters . You can go ahead and apply some topical steroid cream (skin needs to be intact) and give her some benadryl (diphenhydramine) orally. Consult with your Pediatrician if it is becoming infected, hot to touch, tender and changing in color.