The blue dragon tail-bone is an item on the Odd Old Man's wish list after the Fur 'n Seek quest, and is dropped by blue dragons. It shouldn't take more than 20 kills to get a bone drop. The 8 other tail bones needed to complete this miniquest are from green, black, red, bronze, iron, steel, and mithril dragons and Skeletal Wyverns
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For an exhaustive list of all known sources for this item, see here
- ^ There is further information on this drop; see the associated page for details.