Black Dragon Pool (also Heilongtan) is the main headwater of the Yushui River which goes through the Old Town. It is just like the bright eyes of the town, shining with the wisdom. People believe that the gods of the Naxi people are living in the chestnut woods, beside the mouth of springs, behind the carved doors and below the bridges. The springs come from the god-protected mountains and gather in this place and finally form the dragon pool. Then water goes down a waterfall and becomes the Yuhe River, pouring life to the Old Town.

The Black Dragon Pool is like an ancient architecture museum. Some of the famous buildings were established suburbs have under protection actually collected from other places. People moved the traditional buildings that almost had been ruined here and let them be protected. Among them, the most famous buildings are the Villa Jietuolin of the King Mu and the Five Phoenixes Tower combines the typical Lamaism plane pattern and exquisite wooden structure of the Naxi architecture. Both the frame and the technology are unprecedented. The buildings can rarely be found even in the world of Chinese architecture.

The Black Dragon Pool's distinguishing feature caters to the habitude of the Naxi who loves nature very much. In the past, it was a good choice for people form the Old Town to go picnicking. They gave themselves a good reason for picnic when they came to thank the blessing of the gods. They took all kinds of delicious food, wine and their specially made hotpot here and gathered together to enjoy the happy and relaxing life.

China tours inclusive of visiting Black Dragon Pool, Lijiang