Daydream Dragons are the hosts of daydreams and fantasies. They spend the majority of their time sitting on clouds, dropping daydreams down into the minds of people passing by. Humans who live near Daydream Dragons must be especially careful not to let their thoughts wander, or they could end up spending hours or even days in a trance-like waking dream state.

Dragons are highly-intelligent reptilian creatures that—from a human perspective, at least—appear to live forever. Many different varieties of dragon exist, each with their own unique qualities, habitats, and behavior. Adolescence in dragons is usually marked by the growth of a hatchling’s wings, although not all breeds of dragons grow wings and some breeds have other traits that indicate the beginning of maturation. In Galsreim, dragons and humans coexist peacefully.

Scrunky is a timid soul, usually resting in the clouds, she only comes down to the main area when a hatchling's wings grow in. Spooky is currently training her to become an assistant for her, as Scrunky was raised by Spooky, and affectionately calls Spooky 'Mama'. She got her name when Spooky was attempting to describe her cuteness as a hatchling, she stated, "Well, she's- how do I say this Aah she's just so, Scrunky!!"