When Smaug was woken by Bilbo under the mountain, he set off to get revenge on the people of Lake Town. For the people there, it must have been a very scary sight, to see this fire dragon come down from the sky…
This ‘dragon’ didn’t come from under the mountain, but was caused by charged particles sent out by the Sun, called solar wind. These particles are pulled in by the Earth’s magnetic field and bump into oxygen or nitrogen molecules, pushing them to an ‘excited state’. When those molecules fall back to their normal state, they emit light, which can be seen from earth.
