Waterhorse Dragons received their name due to their horse-like physique and endearing behavior. They are capable of surviving out of water, and when on land their skin secretes a gelatinous goo to retain moisture. However, their large paddle feet are better suited for swimming, and waterhorse dragons tend to move very awkwardly when on land. Waterhorses are very friendly dragons and enjoy playing with humans.

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.

Kotta Mizuko, meaning "Frozen Water Child", is often cranky. He likes only very cold water, and is often found swimming in deep areas, near the local glaciers. The villagers who live on the shore next to his home have made a deal with him; if he drives the fish into their nets, he will be left alone to his own devices and not hunted or bothered by the humans. Kotta honors this agreement with extreme determination.