The team was formed in 2007 by Jay Penske and businessman Steve Luzco as Luzco Dragon Racing. Using a car on loan from Jay's father Roger, the team hired Ryan Briscoe to run the Indy 500. Briscoe has raced in IndyCar before, but had been out of action since a near fatal crash in 2005. The team finished sixth when the race was called due to inclament weather.
Luzco Dragon returned for a six race schedule in 2008. Briscoe had been recruted for a drive at Team Penske, so Tomas Scheckter was chosed to pilot their car. The South African driver has been infamous for his inability to finish races with out crashing, and this led to the team failing to finish all but one attempt. Their lone finish was a 21st place at Belle Isle.
2009 was the team's first full time season. Brazilian rookie Raphael Matos was chosen to drive the car after Scheckter was released. Matos won rookie of the year honors.
Former driver Gil de Ferran bought into the team, which was by now called de Ferran Luzco Dragon Racing. They partnered with Kingdom Racing and its driver and owner Davey Hamilton for a part time schedule. Matos had another decent but not spectactular season
Raphael Matos was canned by the team for 2011. They hired free agent Tony Kanaan to drive their #2 car. However, Kingdom Racing and the Hewlett Packard sponsorship that comes with them partnered with Dreyer and Reionbold Racing. The team realesed Kanaan before the season started and shut down. Kanaan would be hired by KV Racing Technology
Prior to the Toyota Grand Prix of Long Beach, Jay Penske revived the team. They entered the #8 car for Paul Tracy with sponsorship from Ralph's and Pepsi. The Thrill from West Hill would run a partial schedule for the team. Tracy had a ride with Dreyer and Reinbold Racing lined up for the Indianapolis 500, so Dragon looked elsewhere for drivers. The team hired Chinese driver Ho-Pin Tung and ex F1 and NASCAR driver Scott Speed. Tung crashed hard during qualifying and was bumped from the field. Speed had difficulty getting the car up to speed, so he was replaced by the more competitive Patrick Carpentier who was in his first major open wheel race since 2005. Carpentier crashed on his qualifying run. Tracy returned to Dragon for some more runs in 2011. Tung also returned for a one off at Sonoma Raceway using a rather old Dallara that bore the base livery when driven by Mark Taylor in 2004. Tracy was involved in the accident that claimed the life of Dan Wheldon while driving for Dragon and decieded to call it quits.
Dragon Racing made a major expansion in 2012, fielding two cars for Sebastien Bourdais, a four time ChampCar Champion who switched from Dale Coyne Racing and Katherine Legge, a former ChampCar driver and Atlantics race winner. The season was difficult as the team ran uncompetitive Lotus engines and had a difficult season. The team switched to Chevrolets for the Indy 500, but following that there were not enough engines to support two cars. So Legge would run ovals and Bourdais would run road courses. Bourdais scored the team's best finish at Mid Ohio with a forth place. It was announced that the team would again field two cars at Sonoma. However the tem's future participation in racing was thrown into doubt in August 2012 when team owner Jay Penske was arrested for breaking into a Yacht Club while apparently heavily intoxicated. It is unknown how this affects the team's plans to compete in the upcoming race in Sonoma