This is an extract from A Darwinian Left by Peter Singer:
Marx: Under collective property, the so-called will of the people disappears in order to make way for the real will of the cooperative.
I don't understand this.
The remark occurs in the course of an exchange between Marx and Mikhail Bakunin (1814-76), a revolutionary anarchist. The immediate context is Bakunin's contemptuous reference to 'the so-called people's will' in (bourgeois) representative democracy. The alienated and exploited electorate in the grip of 'false consciousness' (systematic misunderstanding of its true interests) has chosen between political parties none of which is committed to the genuine interests of workers, interests which it uses as a screen for the promotion and protection its own class concerns.
Marx's reply, which you quote, is meant in the first instance to contrast this distorted reflection of the people's (mainly the proletariat's) will - its misperception, as expressed through support for mainstream, bourgeois political parties, of what is in its interests - with the transparently correct perception of those interests that flourishes with the abolition of capitalism and private ownership of the means of production. The people will becomes their 'real' will, an authentic set of thoughts, feelings, preferences, &c., which emerges once the distorting influences of capitalism and bourgeois political parties have been purged away.
Said another way, what Marx has in mind is that in pre-communist conditions the 'will of the people' is still, as a remnant of capitalism, atomistic. It is the sum of individual or group preferences which can destructively conflict. When property becomes properly collective, such individualistic preferences give way to co-operative thinking in which each considers and gives weight to the interests of all. The individualistic frame of mind has disappeared with the class thinking which produced it. The 'real will' of the people emerges as the way people will think and act when atomistic, individualistic distortions have been shed.
More specifically, free from alienation and exploitation, workers will use the means of production, now collectively owned and operated, to make their own decisions, to choose what they will produce, to express their creativity in their work in (say) workers' producer co-operatives. They will no longer be managerially controlled but independent thinkers and discriminators. It's not language I prefer but you could say that the decisions they make express their 'real will' in the sense of a will guided by the kind of co-operative thinking that comes naturally when not prevented by capitalism.
It should be added that Marx does not suppose that in such conditions there will be no tensions, no limits on individual actions, no use of social controls or use of force. It is only, and importantly, that people will be free to think and act for themselves, and able and willing to co-operate, in conditions that capitalism had previously made impossible.
My own views about Marx are my own concern. I have only tried to explain his position in light of the question.