The Great Dragon was an ancient Dragon that supposedly descended from the heavens, soared over Avalice, and transformed into the Kingdom Stone. The Three Kingdoms, Shang Tu, Shang Mu, and Shuigang, were built in its honor. It is worshiped by the Avalicians as a divine figure.
It is revealed by Pangu's message left by the Dragon Scientist that the Great Dragon is a hoax and never existed. Rather, the dragons are an alien race who were stranded on Avalice and created the Kingdom Stone from their remaining energy supply.