Remove the dragon tree from its pot. Crumble off all the soil from around the root ball. Discard the old soil since it harbors fungi. Rinse the roots of the dragon tree under running water for approximately one minute.
Inspect the roots for damage, black spots or other obvious signs of infection. Snip off any infected or heavily damaged roots with pruning shears. Discard the damaged roots. Thoroughly clean your pruning shears after using them on the dragon tree.
Wrap the roots of the dragon tree in a slightly moist towel while preparing its new planter and soil mixture. Set the plant out of direct sunlight to keep it from becoming stressed or dehydrated.
Combine 2 parts sterile loam, 1 part peat moss or coir, 1 part coarse sand and 1 part perlite to create a suitable soil mixture for your dragon tree. Drizzle water onto the components while combining them to lightly moisten the completed mixture.
Fill the bottom 2 inches of a plastic or glazed ceramic planter with the soil mixture. Use a planter with at least two drainage holes to keep the soil from becoming waterlogged after watering.
Remove the moistened towel from the dragon tree. Hold it inside the planter so the roots touch the soil in the bottom and the base of the stem rests 1/2 inch below the lip of the planter.
Backfill around the roots with the soil mixture created in Step 4 until the planter is filled to within 1/2 inch of the top. Shake the planter to settle the soil among the roots. Press the surface to extract any trapped air. Add more soil to the pot if it settles too much.
Place the repotted dragon tree where it will receive warm, dry air and adequate light. Water the plant to a depth of 1 inch whenever the soil dries completely. Do not water more than that because the root fungus will return and further damage the dragon tree.