Some may say that the most dangerous part of Dungeons & Dragons is the Dungeon Master, but an arguably more dangerous part is the player. Many campaigns have ended with good ideas going badly, bad ideas going well, or just straight-up bad ideas going bad.
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The stronger a player character gets and the more powerful gear and skills they gain, the more they transform into a walking glass case of nitroglycerin. One way that players tend to hurt themselves beyond recognition is by falling, but there are multiple factors to take into effect when you calculate fall damage.
Unlike a majority of video games, Dungeons & Dragons realism very seriously, save for all the fantastical elements that define it. Although there are a wide range of species, each with their strengths and weaknesses, all of them are vulnerable to blunt force trauma, especially if it takes the form of falling a long way to the ground.
Player characters and NPCs are eligible to receive fall damage once they fall further than ten feet. However, take into effect equipment, racial bonuses, class bonuses, passive skills, and active magic before you dish out the damage dice.
Based on the current version of Dungeons & Dragons, which is 5e, characters will take fall damage in batches of ten feet. After falling the first ten feet, a character has a chance to receive 1d6 of fall damage. Every additional ten feet adds another d6, for a maximum of 20d6.
This has a max damage output of 120 hit points, which is enough to kill a majority of player characters.
Depending on the type of ground (rocky, spiky, grassy, etc.), you can add or subtract damage at your discretion. If they fall past the 20d6 mark, you don't add any additional damage dice, so this leads to the interesting scenario that a bulky character can fall thousands of feet and still only take a little over 100 points of damage.
For flying creatures, calculations are a bit different. If anything happens to the flyer to cause it to stop flying (being knocked prone, stunned by an attack, etc.) it starts falling from the distance it was when it was stopped.
However, for the sake of realism, most flyers will react somehow to reduce their speed when falling, like flapping. To calculate this, reduce the speed that the flyer was moving at from the fall height to get the right amount of d6s.
When it comes to falling during combat, you can discuss how best to treat it. A general rule of thumb is to treat falling as instantaneous. As an example, imagine a battle where two players are fighting an orc archer positioned on a watch tower.
One player launches a spell at the orc, causing him to lose his balance and fall. The watch tower is 30 feet up (so the orc would take 3d6 fall damage), but the orc can hit the ground the moment he falls, or the group can discuss a scenario where player two tries to stop his descent somehow.
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