It was fashioned after the military orders of the Crusades, requiring its initiates to defend the cross and fight the enemies of Christianity, particularly the Ottoman Empire.

However, after the Fall of Constantinople in 1453, it continued to play a role in Hungary, Serbia and Romania, which bore the brunt of the Ottoman incursions.

On December 12, 1408, Sigismund and his queen, Barbara von Cilli, founded the league known today as the Order of the Dragon.

[6][7][8] Its statutes, written in Latin, call it a society (societas) whose members carry the signum draconis (see below), but assign no name to it.

The aim of the order was to fight the Ottoman Empire, defend the Hungarian monarchy from foreign and domestic enemies, and the Catholic Church from heretics and pagans.

Boulton argues that "the Society of the Dragon was clearly intended to serve [...] as the institutional embodiment of the royal faction its founder had created".

The statute of the Order, which was expanded by Bishop Eberhard of Nagyvárad, chancellor of Sigismund's court, survives only in a copy made in 1707,[8] which was published in an edition in 1841.

[10] The prologue to these statutes of 1408 reports that the society was created: in company with the prelates, barons, and magnates of our kingdom, whom we invite to participate with us in this party, by reason of the sign and effigy of our pure inclination and intention to crush the pernicious deeds of the same perfidious Enemy, and of the followers of the ancient Dragon, and (as one would expect) of the pagan knights, schismatics, and other nations of the Orthodox faith, and those envious of the Cross of Christ, and of our kingdoms, and of his holy and saving religion of faith, under the banner of the triumphant Cross of Christ...[11]The edict of 1408 describes two insignia to be worn by members of the Order: ...we and the faithful barons and magnates of our kingdom shall bear and have, and do choose and agree to wear and bear, in the manner of society, the sign or effigy of the Dragon incurved into the form of a circle, its tail winding around its neck, divided through the middle of its back along its length from the top of its head right to the tip of its tail, with blood [forming] a red cross flowing out into the interior of the cleft by a white crack, untouched by blood, just as and in the same way that those who fight under the banner of the glorious martyr St George are accustomed to bear a red cross on a white field...[11]The dragon described here, with its tail coiled around its neck, bears comparison to the ouroboros.

On the back of the dragon, from the base of the neck to the tail, is the Red Cross of Saint George, with the entire image on an argent field.

[12] A University of Bucharest annotation to the original edict reads "O Quam Misericors est Deus, Pius et Justus" (O how merciful is God, faithful and just), which may have been officially part of the emblem.

Common changes included the addition of inscriptions like O Quam Misericors est Deus ("Oh, how merciful is God") and "Justus et Paciens" ("Just and patient").

However, the prestigious emblem of the Order was retained on the coat of arms of several Hungarian noble families, including Báthory, Bocskai, Bethlen, Szathmáry, Benyovszky, Kende and Rákóczi.