A dancing dagger with an attitude, the Red Dragon Dancing Dagger refuses to obey his wielder without being fed some gold coins. When hungry (as in - activated but not fed gold), the dragon is very rude and abusive, not hesitating to call attention to his user and offer insulting insights - gold shuts him up. Each gold coin buys a minute of silence and compliance. He gets full after 10 coins, he refuses to eat more than that in one sitting (once an hour). It can follow simple commands (like “attack that target”, “don’t let anyone pass through that door”, or “if Bill passes by, kill him”).

In combat the dagger attacks furiously and very fast - twice a round. It has a +3 bonus for attack and damge (using the basic hit chance of the owner). The blade burns red hot in combat and adds 1d8 of heat damage per hit. Once per 10 rounds, the dragon head can breath a cone of fire for 3d8 points of magical fire damage.

The fire damage and breath are unusable when the dagger is wielded physically.

After finishing with his task, the dagger flies back to the owner - actively losing anyone who tries to follow it. The only way to become the owners this dagger is by either killing the current owner, or stealing it from him, any other attempt will be denied by the dagger and he’ll find a way back to his perceived owner.

The dagger is actually a very old red dragon that was wished into a weapon. The only thing that can destroy the dagger would be another wish spell... but that would release the full grown dragon. The dragon knows this and goads adventurers he deems capable of "destroying" him into doing so - being as horrible as he can and as big a threat he could be to make that happen. Once released, the original dragon body will start to grow, as he ages almost immediately. After reaching a Great Wyrm status (in 2d4 rounds) for several rounds, he will start to decay and rot, and in 2-5 (1d4+1) rounds he will be a pile of bones. Cruel DMs may wish to animate him as a Dracolich at this point.

This can be a great way to have a huge red dragon fight without needing to destroy the party.