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Water Dragon Location. Water Dragon. The water dragon is a large species of lizard native to the forests and jungles of Asia and Australia. Water dragons are arboreal animals meaning that they spend most of their time in the trees, often close to a large body of water.
Description [edit]. Australian water dragons have long powerful limbs and claws for climbing, a long muscular laterally-compressed tail for swimming, and prominent nuchal and vertebral crests. (A nuchal crest is a central row of spikes at the base of the head.ustralian water dragons have long powerful limbs and claws for climbing, a long muscular laterally-compressed tail for swimming, and prominent nuchal and vertebral crests.