。
A dragon is an imaginary creature.
Literal
Dragon [topic-は] imaginary creature is.
想像上の (existing in imagination, literally 'above/in imagination') is a slightly more abstract framing than 空想の (fanciful/dreamlike). 生物 (living creature) is broader than 動物 (animal). The formal copula である gives it a stiff, encyclopedic tone — the kind of register a textbook entry would use.