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The main location for hellhounds is deep in Taverley Dungeon. An alternative spot is found in the small dungeon that's part of the Family Crest quest, but there's only two monsters there, and they have a slow respawn speed.
To get to the dungeon in Taverley, hop the west wall in Falador and go northwest to the dungeon entrance; you can also use the balloon network from Castle Wars.
High Agility is useful to get to the hellhounds. If you have level 80 (or can use a pot or pie to get that high) then take the shortcut to the poison spiders area, head north, and you're there. With level 70 you can take the pipe shortcut to the blue dragons, then run south, west and north past the black demons and spiders. If you can't use either shortcut, you have a long walk ahead of you.
The Family Crest Dungeon is accessed via a dungeon entrance in Witchaven, east of Ardougne. It is also used as part of the slug quest storyline.
Kuradal's Dungeon is the best spot to fight these on Slayer assignment; get there quickly using a ferocious ring and then enter the cave; they are the first monster you encounter. If you don't have a ring, use the fairy rings to code "B J Q", then run south and go up the stairs to Kuradal.
Finally, there are also some hellhounds in the Wilderness, easily accessed by using the teleportation lever in Ardougne. Of course, this is risky due to revenant activity.
Equipment
Very high-level players can get by with non-Barrows armor, while others will be better off wearing something with higher defence. You can also use Guthans for healing, or try to Dharok them (prayer recommended unless you are experienced at Dharoking.)
For ranging or maging, wear standard gear as appropriate, since safe spots are no problem.
If on a Slayer assignment, a Slayer helmet will increase your kill speed by about 10-15%. You should try to fight them in Kuradal's Dungeon wearing a ferocious ring if possible, but note that this area tends to get crowded.
Supplies
For meleeing, bring super sets and either runes or tablets for Bones to Peaches. A healing familiar can also be useful.
For ranging or maging, bring appropriate ammunition or runes; pretty much anything will work well on these, which are very good training monsters.
You have to go past level 64 poison spiders to get to the hounds (in their conventional location), so unless you are combat level 129 or higher, an antipoison is recommended.
Familiar
These have no unstackable drops but bones; use a healing familiar.
Combat Notes
For mid-to-high level players, these monsters are nearly ideal for Bones to Peaches, because they hit hard, drop bones, and have almost no other drops so you have lots of room to pick up the bones. Very high level players won't need this, especially if using a bunyip or other healer.
It is very easy to trap these monsters behind obstacles when ranging or maging.
Drop Notes
All these drop are bones, charms, the occasional level 3 clue scroll, and the special ferocious ring in Kuradal's Dungeon. Their charm drop rate is pretty good, but they mostly drop the less valuable gold charms.
Only drops bones, charms and clues. Note that I used the summer pie to get through the level 70 Agility obstacle -- it's not really needed otherwise.
Approximately 13% faster kills with black mask.
SGS provides very slightly faster kills, mainly because the prayer restoration ability allows me to keep Burst of Strength continuously. Note the dramatic reduction in food use.