The Dragon Cave is in the Nomad Highlands, about 60 m south-west of a Flame Shrine. A gold chest with the Legendary Dragon Sword sits around 40 m to the west of the cave marker.
Quick answer: Go to the cave in the Nomad Highlands and open the gold chest 40 m west of it. The Rumors Of The Dragon Cave collection has 3 notes, and the Blacksmith crafts new copies of the sword.
| What | Where |
|---|---|
| Dragon Cave | Nomad Highlands, about 60 m south-west of a Flame Shrine |
| Dragon Sword (Legendary) | Gold chest about 40 m west of the cave marker |
| “The Fearsome Dragon” | About 105 m north of Surat’s Rest |
| “The Renowned Dragon Sword” | About 12 m north of the Research Camp (Pillars of Creation) |
| “Dragon’s Maw” | About 210 m east of the Northern Caravan Camp |
Dragon Cave location in the Nomad Highlands
Landmarks around the cave:
- A Flame Shrine is positioned roughly 60 m to the north-east of the cave marker.
- A Return Beacon stands about 275 m north-west of the cave.
- Find the Sharp Shark Tooth collectible roughly 70 m to the cave’s north.
Reading any one of the three Rumors Of The Dragon Cave notes also puts the Dragon Cave on your map.
The Dragon Cave, the sword’s gold chest and all three notes are on our interactive Enshrouded map.
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Reading the notes beforehand isn’t required. The gold chest remains available even if you haven’t found them; the notes simply explain its story.
Dragon Sword stats and enhancement perks
The Dragon Sword is a one-handed sword that deals Cutting and Fire damage. Its item text reads: “A mythical blade from long gone days. Legends say that it was passed on to Embervale by a wise spirit who descended from the stars in the year of the dragon.”

Perks when enhanced:
- At level +4: Renewal +1, “Defeat an enemy to restore Durability”
- At level +5: Critical Strike Chance +5% to +7%
Since the chest copy is Legendary, upgrading its final two enhancement levels requires Legendary Runes at the Blacksmith.
Crafting more Dragon Swords at the Blacksmith
Once you’ve found the Dragon Sword, Oswald Anders the Blacksmith can craft Rare copies. He needs a shelter to work in, and the item level he offers follows your Flame level.

| Item level | Materials |
|---|---|
| 16 | 3 Bronze Bars, 1 Tin Bar, 2 Resin, 2 Tar |
| 21 | 3 Iron Bars, 2 Tin Bars, 4 Resin, 4 Tar |
| 26 | 3 Steel Bars, 3 Tin Bars, 6 Resin, 6 Tar |
| 36 | 2 Gold Bars, 4 Tin Bars, 8 Resin, 8 Tar, 2 Steel Bars |
| 46 | 2 Celestium Bars, 1 Gold Dust, 8 Resin, 8 Tar, 2 Steel Bars |

Rumors Of The Dragon Cave note locations
In the journal’s Nomad Highlands section, Rumors Of The Dragon Cave appears as a lore collection of 3 notes. All three entries add the Dragon Cave to your map.
| Note | Location |
|---|---|
| The Fearsome Dragon | About 105 m north of Surat’s Rest |
| The Renowned Dragon Sword | About 12 m north of the Research Camp at the Pillars of Creation |
| Dragon’s Maw | About 210 m east of the Northern Caravan Camp |
“The Fearsome Dragon” comes from someone nobody believes: “I told them the truth, but they won’t believe me! The dragon is real!” The writer recalls the encounter in detail: “When I stumbled into that cave and met its ferocious gaze, eyes glowing with mystical light — I turned ’round like a whirlwind and dashed off!”
“The Renowned Dragon Sword” is about the blade itself. “The others don’t believe in the existence of the Dragon Sword. They think it’s just a fable from a bygone era.” Its author hopes to prove them wrong: “If I found the Dragon Sword and retrieved it from it’s forgotten cavern, I could add credence to my theory.”
“Dragon’s Maw” is a rhyme about the sword. It opens with “A dragon guards the lonely tunnels, sleeping, quiet, stiff” and warns, “It holds a sword inside its maw, but do not grab it, little one”.






