Numbers of the small lizard appear to be on the rise in the few habitats in the region, a survey carried out by the ACT government and the University of Canberra has shown.

Murray Evans, a senior ecologist from the Environment and Sustainable Development Directorate, said researchers had monitored the reptiles at several sites in the ACT every year since 2001.

They spotted more lizards at sites in the Majura and Jerrabomberra valleys in February and March than in recent years.

''When the 2004-05 drought hit we really noticed a huge decline,'' Dr Evans said.

''They were virtually undetectable. We just didn't see any.

''We've been catching more this year, and we've been catching quite a lot of newly hatched and juvenile animals, which is a sign of a good breeding season.''

Dr Evans said while the upsurge wasn't enough to bump the lizard from the threatened species list, it was a ''really encouraging sign''.

''They're really a remarkable little creature. It would be a shame to lose them,'' he said.

''We've got our fingers crossed it's a sign of recovery for the lizards, but it's still a long way before we can sit back and say the population at that site has recovered.''

While it was difficult to speculate on numbers, Dr Evans said hundreds of lizards would have been found at the Jerrabomberra valley site before the drought.

In the years following, the population likely dropped to one-tenth of that estimate.

The dragons favour natural temperate grassland and were once widely found in south-east Australia.

The species is known to live only in small patches of native grassland in the territory and parts of the southern highlands of NSW.

It is thought to be extinct in Victoria.

Dr Evans said a loss of habitat was likely one of the main factors that had contributed to the species' decline.

He said less than 1 per cent of Australia's natural grassland remained, and a loss of ground cover in those areas had been exacerbated by grazing cattle and kangaroos.

The collapse of the population prompted the territory government and University of Canberra to put several lizards in captivity as an ''insurance population'', and for research.

Stephen Sarre, a professor at the university, said part of the research would focus on breeding the dragons in captivity to determine whether higher nest temperatures could have caused fewer eggs to hatch.

''Some of the captive animals will also be released and radio-tracked,'' he said. ''This will be the first time for this species to be reared in captivity and then released, and it will really allow us to look at how they use the grasslands.''