A Dragon appears in the "Elmo the Musical" segment, "Prince Elmo the Musical."
Prince Elmo receives word from his Royal Guards that the dragon is terrifying the town of Tottentot. When they arrive, they learn that this menacing dragon doesn't breathe fire, but possesses atrociously stinky breath. Elmo combats by eating garlic and Limburger cheese to make his breath even stinkier, which ultimately defeats the dragon.
The dragon speaks in a low Southern accent based on that of Johnny Cash. His color scheme and overall design is reminiscent of the Mr. Dragon puppet used on Sesame Street. The model for the character was later used in a season 44 episode, only changed to green.