Dragon's blood is a red resin mainly extracted from Dracaena plants, and has been widely used as a traditional medicine in East and Southeast Asia. The major components of dragon's blood are flavonoids. Owing to a lack of Dracaena plants genomic information, the flavonoids biosynthesis and regulation in Dracaena plants remain unknown. In this study, three cDNA libraries were constructed from the stems of D. cambodiana after injecting the inducer. Approximately 266.57 million raw sequencing reads were de novo assembled into 198,204 unigenes, of which 34,873 unique sequences were annotated in public protein databases. Many candidate genes involved in flavonoid accumulation were identified. Differential expression analysis identified 20 genes involved in flavonoid biosynthesis, 27 unigenes involved in flavonoid modification and 68 genes involved in flavonoid transport that were up-regulated in the stems of D. cambodiana after injecting the inducer, consistent with the accumulation of flavonoids. Furthermore, we have revealed the differential expression of transcripts encoding for transcription factors (MYB, bHLH and WD40) involved in flavonoid metabolism. These de novo transcriptome data sets provide insights on pathways and molecular regulation of flavonoid biosynthesis and transport, and improve our understanding of molecular mechanisms of dragon's blood formation in D. cambodiana.