Dawnstar is a town nearly completely encompassed by graveyards. It is currently a sovereign town governed by a Chubby Mustachioed man named Mayor Philip Hayes. Ages ago, Dawnstar was a town of great prestige. Before the war of the Ancients, many of the cities and towns on Caldonia were united under a common banner, loyal to the royal family Rothfus in the city of Northampton, which occupied what is now the infamous Fortress of the kobold lord.

Dawnstar earned its fame due to its regiment known as The Dawnstar Dragoons: An elite polearm wielding brigade who often led the forces of the Rothfus army into battle. Dawnstar was also near the site of an enormous battle that took place between giants and dragons. The Rothfus family sided with the giants, and their forces suffered immense losses. Nearly all of the Dragoons were slain, only a few of them survived to pass on their traditions to future generations. They are now led by a Dragonborn named Bolvar the Titan. These great losses were the cause of the immense graveyards and are certainly why Dawnstar is cursed with nearly endless paranormal phenomena. In recent months, a massive undead army led by a Vampiress rose to destroy the town, but the army was thwarted by local heroes, one of whom named Maze Durum is immortalized as a statue for his repeated selfless efforts. He also is now part owner of a Murder Mystery bed and breakfast outside of town called Proudspire Estate, but he is rarely there.

There is one inn called the Nightshade in the town proper. Its proprietor is Sofie Briggs, who recently inherited the establishment from her late father. It is a surprisingly large subterranean bar in a dwarven style, and the chef, Daisy, is known for her legendary breakfast food.