Evan Jones had brought the Lions back into the game from the depths of a loss, smashing 54 from just 18 balls as the home team tried to chase down a target of 182.
The Lions then needed one run from two balls to win the match but Ruan de Swardt took the wickets of Mitchell van Buuren and Wandile Makwetu as the encounter ended in a tie.
De Swardt then also bowled the super over and limited the hosts to eight runs and getting the crucial wicket of Jones.
Lesiba Ngoepe then hit two fours before visiting skipper Wihan Lubbe secured the final run that meant the Dragons had only won their second T20 match out of seven this campaign.
The Lions have no victories from five games and last season's champions cannot reach the playoffs with two matches remaining.
The Dragons had earlier posted a total of 181-6 in their 20 overs after being put in to bat at the toss.
Janneman Malan top-scored with 56 from 43 deliveries but the innings was given impetus at the back-end when De Swardt smashed an unbeaten 45 off just 20 balls.
The Lions next face Western Province at Newlands on Friday before ending their CSA T20 Challenge campaign against the Dolphins in Durban on Sunday.