Dragons have strong feelings about territory: both their own, and other beings'. Central to understanding a dragon's view of territory is the concept of the Sovereign, an individual who holds absolute power over their domain and all that lies within it. Any dragon who holds territory, however large or small, is considered the Sovereign of that territory. When regarding human civilizations, dragons will usually judge the king, queen, or chieftain to be the Sovereign of that land.
Scattered across the landscape are a variety of lairs and landmarks, just waiting to be claimed. To claim such a location, a dragon unleashes a resounding roar, which sends a clear message about who rules the surrounding area. The dragon's territory extends out in a circle around this point, its size determined by their Dominance score.
However, not every dragon can claim every landmark or lair. Many locations require dragons to have a minimum level of Dominance for their claim to be taken seriously. It's even harder to take ownership of territory held by another dragon, since the would-be Sovereign must overcome the current owner's Dominance, even if they already meet the landmark's minimum requirement.
If a dragon's Dominance score falls too low, they may lose ownership of territory they previously held, and this is something all dragon's take pains to avoid.
To dragons, being a Sovereign means having absolute power within one's own territory. This power may be used cruelly or benevolently, rarely or often, but it is always present. One of the few hard-and-fast rules of draconic society is that you should never meddle in the affairs of another dragon acting within their own territory. If a dragon disapproves of a how a Sovereign deals with their land and subjects, they can either do nothing or claim the territory for themselves.
Dragons without a territory of their own may offer tribute to the ruling Sovereign in exchange for the right to hunt for food or treasure on their land. Most Sovereigns are happy to make such deals, since it saves them the trouble of hunting for themselves and provides a reliable source of treasure. Failing to live up to their end of the bargain can get a young dragon expelled from the Sovereign's territory (if they are not eaten outright).