Back in 2012, AudioQuest created an entirely new product category with the DragonFly DAC. With the form factor of a USB flash drive, low price, and truly amazing sound quality, the DragonFly was spectacularly successful. The DragonFly didn’t just appeal to hard-core audio enthusiasts; it was just as tempting to anyone who listened to music from a computer. The product was simple to use and the value proposition was compelling: Rather than connect headphones or a desktop audio system to the computer, plug them into the $149 DragonFly and get better sound. The DragonFly delivered on its promise, showing an entirely new audience that investing in a better audio system could greatly enhance their enjoyment of music.

A few years ago when I was selecting a DAC for my newly upgraded desktop audio system I compared several sub-$400 models and overwhelmingly preferred AudioQuest’s DragonFly. Although it was the least expensive DAC in my informal survey, the DragonFly was by far the most open, smooth, detailed, and musically communicative. I listen to a lot of music on my desktop system and have logged countless hours with the DragonFly.

AudioQuest has now retired the DragonFly in favor of two new models, the $99 DragonFly Black and $199 DragonFly Red, both reviewed here. In addition to offering better sound than the original, the Black and Red can be used with Apple and Android smartphones and tablets. The first-generation DragonFly was limited to use with computers because of its high current draw. But DragonFly designer Gordon Rankin worked with a chipmaker to develop a USB microcontroller with 77% less current draw than the previous microcontroller. Incidentally, the DragonFly is made in Ohio, and every unit is auditioned as it comes off the production line.

The revamped DragonFlys also feature new DACs—the 9010 32-bit ESS Sabre chip in the Black and the higher-performance 9016 in the Red. Both chips feature minimum-phase digital filtering. The Black includes the same headphone amplifier as in the original DragonFly, while the Red gets an ESS headphone amplifier with a digital volume control that is integral to the DAC chip. The Black’s maximum output level is 1.2V; the Red’s is 2.1V, allowing it to drive low-sensitivity headphones. Finally, both DACs are software upgradable for compatibility with future developments via a desktop application available from AudioQuest.

I compared the Black and Red to the original DragonFly in my desktop system as well as through PSB M4U 2 headphones ($399) and the state-of-the-art Audeze LCD-X planar-magnetic headphones ($3995). That desktop system includes the amazing Audience 1+1 V2+ speakers. A worthwhile upgrade to either DAC is AudioQuest’s $49 JitterBug, an in-line USB device that fits between your computer and any USB DAC. The JitterBug isolates the computer from the outboard DAC, reducing jitter as well as noise and ringing on both the power and data lines in the USB interface. It’s a brilliant, highly cost-effective product and simple to use.

The Black is a massive upgrade over listening directly from the computer’s analog output jack. In fact, for someone listening to the computer’s output, adding a DragonFly Black is without a doubt the greatest bang for the buck in all of audio. It’s the single most important step someone can take toward better sound. The computer’s audio output (a Dell XPS 8700 in my case) is flat, grainy, bright, airless, and hard, quickly inducing listening fatigue. The treble is a joke; cymbals sound like aerosol spray cans. The Black elevates the computer-listening exper-ience by delivering a much smoother, more relaxed, and warmer sound. The Black has a tonal richness and body that better portray instrumental and vocal timbre. The computer’s audio output, by contrast, sounds thin and threadbare. The treble is far, far cleaner through the Black, with a real sense of delicacy and texture rather than mere high-frequency hash. Another big improvement is the sense of space and dimensionality; where the computer’s output is flat and congested, the Black is open and airy. The $99 upgrade allows you to hear individual instruments with some air and space around them. In all these regards, the Black is a step up from the DragonFly and the DragonFly v1.2, not to mention a massive improve-ment over the unlistenable computer output. For the record, the Black drove the PSB M4U 2 headphones to any listening level but it didn’t have quite enough output to drive the Audeze to a satisfying volume.

But as good as the DragonFly Black is, I think that most TAS readers looking in this category will opt for the Red. Yes, it’s that much better and worth double the price. This is particularly true if you have difficult-to-drive headphones; the Red’s more robust output amplifier (2.1V vs. the Black’s 1.2V) has greater dynamic swings and more solid bass. The Red drove the Audeze LCD-4 headphones adequately, although at the maximum output level the volume was slightly lower than I would like for some music. The Red also improves on the Black with significantly greater smoothness, ease, and warmth. In my desktop system and through headphones, the Red upped the ante in every sonic criterion. On the wonderful Gerry Mulligan album Lonesome Boulevard, the Red conveyed the warmth and body of Mulligan’s baritone sax. The terrific piano playing (by a young Bill Charlap) was also better served by the Red, with cleaner attacks, more realistic timbre, and a greater sense of air around the instrument. The Red is also more dynamic, with greater impact on drums and a more lively and upbeat rendering.

The combination of the DragonFly Red and JitterBug turned out to sound so good that I moved the pair from my desktop system to my main system, where they were fed from an Audender W20 music server and drove my reference system. The DragonFly’s analog output fed the Constellation Altair II preamplifier via a run of AudioQuest 3.5mm-to-RCA breakout cable. Putting a $199 DAC at the front end of a reference-quality system may seem crazy, but nonetheless provides a different per-spective from which to examine the DragonFly’s performance.

Simply put, the Red/JitterBug combination sounded much, much better than it had any right to for $250. Even at the front end of a system that is highly revealing of source quality, the DragonFly was listenable and enjoyable. Hearing it in this context also gave me an appreciation for how cannily the DragonFly Red’s inevitable tradeoffs were chosen for the most musical overall result. For example, the tonal balance is slightly skewed toward a richer and darker rendering rather than attempting to resolve the last measure of treble openness and sparkle. This has the effect of minimizing the Red’s slight grain in the upper midrange and treble. I don’t want this to sound like a criticism; it’s inevitable that a $200 DAC will have a less-than-pristine treble. In fact, compared to any other sub-$500 DAC I’ve heard, the DragonFly Red has the cleanest treble. But the designers mitigated the inherent compromises in a way that best serves the music. The DragonFly Red avoids the stereotypical sound of inexpensive DACs in which the presentation is hard, bright, metallic, uninvolving, and fatiguing. I noticed these design choices only when the Red was in my big reference system and I was listening analytically. Before putting the Red in my main system, I’d been enjoying the DAC virtually every day for months as part of my desktop setup without ever thinking about the sonic tradeoffs. That’s the mark of exceptional design.

The Red’s bottom end was deep and extended, with a nice combination of bass heft and definition. The Red was equally adept at conveying the dynamic punch and drive of the hi-res download of Talking Heads’ Speaking in Tongues as it was at communicating Scott Colley’s nuanced acoustic bass playing on the Gary Burton CD Guided Tour. The bass wasn’t just weighty; it had excellent pitch definition and dynamic expression. There was an odd disconnect at hearing the mighty Magico Q7 Mk IIs with their prodigious bottom end and knowing that the source was the tiny DragonFly.

I was also impressed by the Red’s sense of air and space. Again, the Red miraculously avoids the inexpensive-DAC syndrome of sterile flatness and congestion. The Red, in my desktop system, through headphones, and in the reference system, presented instruments as individual objects with a nice halo of air around them (if that’s how they were recorded). The group Oregon’s wonderfully spacious Beyond Words (a Chesky release from the 1990s) was well portrayed, with a real sense of three musicians within an acoustic.

With the DragonFly Black and Red, there’s simply no excuse for listening to the compromised DACs and output amplifier built into computers. At $99, the Black brings much of what high-end audio is about to just about any quality-conscious listener. The Red is significantly better sounding, and worth the price difference. Adding AudioQuest’s $49 JitterBug is a no-brainer for either, allowing the Black and the Red to reach their full sonic potential. And these new models work with Apple and Android phones, bringing high-end sound to a much wider audience.

With the DragonFly, AudioQuest has created a simple and affordable path into the high end for a new generation of listeners, as well as the perfect product for an audiophile’s personal-audio system.