The +1/+1 counter is put on Slumbering Dragon before blockers are declared. This may allow Slumbering Dragon to "wake up" and block the creature that attacked and caused its ability to trigger.

Slumbering Dragon's third ability will trigger once for each creature that attacks you or a planeswalker you control.

Slumbering Dragon's second ability counts all +1/+1 counters on it, not just the ones added by its third ability.