This strategy works for all difficulties up to Nightmare. Utilize a combination of ensnare and strength drain auras, magic blockades and fireball towers to defend each choke point around the center stage. Position your auras so that each covers two of the four bottom choke points near the lava pits. Place backwards facing magic missile towers to protect towers from spiders. Place four deadly striker towers facing each direction on the lower stage with two crystals to protect from both spiders and wyverns. Do not devote any defense units to placing towers on the upper ramparts to combat the dragon, as either a combination of his fire breath, fireballs or spiders spawning will take them down easily.

To take down the dragon, shoot him down with the war ballista then quickly run the second closest tower rampart facing his landing point. It is ideal to use a ranged damage-dealing hero for this task. The dragon's fireballs are much more slow-moving and avoidable than his close-range fire breath.

Alternate jumping from each crenelation of the second tower rampart to easily dodge his fireballs, whilst ensuring any stray fireballs to pass safely above your defenses down below on the center stage. Depending on your damage dealing capacity, this may take up to an hour to take down the dragon, however your defenses should take little to no damage whilst withstanding the endless waves of enemies below.