Dragon allows Ryuko to transform into a dragon, a powerful mythological creature. This form grants her abilities commonly associated with dragons, including flight, powerful jaws and claws. The activation of this Quirk seems to be connected to the claw-like accessory on Ryuko's head.
Ryukyu's physical strength in this form allowed her to effortlessly block a punch from Rikiya Katsukame, a yakuza member with superhuman strength, as well as restrain him, and later to knock him back and hurt him despite having been weakened by his Quirk, and despite the latter having just shrugged off one of Nejire Hado's shockwaves. Her durability also increases considerably, allowing her to be hit by her trainees' most powerful attack without taking damage.
It is worth noting that despite her form changing, Ryukyu remains capable of grappling with the opponent, grabbing their hands with her claws, restraining them with submissions, and using her fangs as extra appendages in a hold.