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This represents a creature’s ability to ignore a certain amount of melee damage (bludgeoning, slashing, or piercing) from a single hit unless the weapon inflicting the wound has an enhancement bonus equal to or greater than the damage reduction. Damage reduction is listed along with the amount of damage ignored and the power of the weapon needed to penetrate the effect. Thus a creature with 20/+3 damage reduction ignores the first 20 points of damage from any weapon that does not have an enhancement bonus of +3 or greater. Non-melee damages such as from elemental or magical attacks ignore damage reduction.
Creatures that have damage reduction are considered to have natural attacks equal to that damage reduction. For example a red dragon has a damage reduction of 20/+3. When attacking other opponents with damage reduction it is considered to have an innate enhancement bonus of +3.