The Welsh flag dates at least back to Cadwaladr ap Cadwallon (reigned 655-682 AD), when he flew what has come to be known as “the Red Dragon of Cadwaladr” as his banner as King of Gwynedd.  Today, it is known as the ‘Welsh dragon’ and the the Welsh flag looks like this:

Within Welsh mythology, the story of the two dragons, one red (for the Welsh) and one white (for the Saxons) fighting beneath Dinas Emrys dates back to Geoffrey of Monmouth, writing in the 12th century.

The coat of arms of the Welsh princes in the 13th century was actually this:

With the death of Llywelyn ap Gruffydd and the complete suppression of everything that had belonged to or symbolized the Princes of Wales, this banner disappeared from royal heraldry.

Henry Tudur (Henry Tudor/Henry VII) of England, in a quest for legitimacy, both to the Welsh and the English, took the Red Dragon and made it his own.  He claimed that he was a direct descendent of Cadwaladr.  In creating the banner, he laid the dragon over the green and white colors of the House of Tudor.  Henry then marched through Wales on his way to seize the crown on 22 August 1485 when he defeated Richard III at the Battle of Bosworth Field.  The flying of the flag was very deliberate.  For the Welsh, it was Cadwaladr, not King Arthur, who was to ‘return’, to save the Welsh from their enemies.   Henry Tudur very deliberately took up that mantle.

In an interesting twist, Henry’s first son was named ‘Arthur’.   He died in 1502, however, and was succeeded by his brother, Henry (becoming Henry VIII) as the heir to the throne.