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Killing G-Rank rank elder dragons, specifically Teostra and Lunastra. It is a moderately rare drop and the odds of getting fire dragon powder are increased if you break the horns of the dragon. The quest where you fight Teostra at town is easiest as it is easy to menuever in the large open battlefield. You also get a bed, all the towns weapons, and lots of suplly items to fight Teostra.