How To Write Telepathy

In my story there are a race of dragons that can only communicate through telepathy. How do I write them speaking to each other and humans?

As an avid reader of science-fiction and fantasy, I can tell you there is no standard way of writing telepathy.

Some use < > instead of quotation marks.
Some use dashes. -This is telepathy.-
Or italics.
Or bold.
Or quotation marks and italics.
Or ordinary quotation marks and they indicate in the text that it's telepathic.
Or nothing at all.

I was considering using quotation marks and italics, but I wasn't sure if it would be the right way. But now I think I'll definitly use it!

I'd say it depends on how prevalent telepathy is in your story. If it's fairly uncommonly used, using a method that stands out is appropriate. (such as italics or italics + quotation marks.) However, if there's going to be quite a bit of it, I wouldn't want to read pages after pages that are half italics... that defeats the point of setting it apart.

Bookworm140 and keolah, I'll keep that in mind.

I try a single quote and italics. 'This is telepathy'. If I just use single quotes by themselves 'like this' it's easy to confuse with regular dialogue written "like this", and I've found in other books that use italics alone that it bothers me when I can't tell if it's emphasis or someone responding to someone else's thoughts. He's really dumb can be either Jack thinking that someone's really dumb, or Jack thinking that someone's dumb an telepath!Jill adding that he's really dumb. And, of course, "he thought" or "she said telepathically" after every line of telepathic dialogue is really damn annoying.

I've seen the alternative to quotation marks < where this > -or this- :or this: mean telepathy. (I think I saw the colon in some of Mercedes Lackey's writing, coupled with italics, but it's been a while.) And I read a graphic novel once where telepaths communicated in a different font.

Since they're dragons, maybe they speak in bold?

I wouldn't temper too much with the format too much if I were you. It gets confusing.

By the way, if it's clear anyway that your dragons can ONLY use telepathy, why not just stick with normal dialogue tags? It's their way of speaking after all, and if it's clear to the reader then you wouldn't have problems anyway.
Just because it's telepathy, doesn't mean it's not a dialogue.

If they were talking with their mouths AND by using telepathy, now that would be a whole different matter.