Lothlorien is a special 3-stage challenge dungeon. The three stages run consecutively with no break in between, meaning your gold stocks have to last across all three levels.
Level 1 - Scouting
You play an elven rogue - 20% dodge, +50% damage, first strike, glyphs convert to +2 mana. The enemies are Goblins, Medusae, Imps and Goats. Imps and especially goats are the easy meat here, with one-hit kills aplenty. Cydstepp, Burndayraz and Afeelsik are glyphs worth hoping for, and deities with +% damage are a help. The boss is a goblin with 20% resistances, 90 damage and 397 hits. Plan on finding a way to plink him down while healing in between blows.
Level 2 - Defending the walls
This time you're an Elf Wizard. Enemies are Naga, Dragonspawn, Serpents, Goats. Boss is a Dragonspawn with 75 damage, 954 hits and 25% magic resistance. Even worshipping Mystera Annur, I wouldn't bet on fireballing him to death.
Level 3 - Kill the Leader
Ever wanted to be an Elf Berzerker? Here your wishes are fulfilled, and you're likely to be low on cash by this point as well. You'll be fighting a remix of enemies from the previous levels, and the boss is a Goat with 300-odd hits, dealing 270 damage per hit (so plan on being incredibly tough or casting Cydstepp a lot). Oh, and he blinks, so if you were thinking of hitting him, poisoning him and then exploring to regain hits/mana... sorry.
- Deities are key here, getting Jehora Jeheyu and subsequently using polymorph makes this a winnable battle.
- Health potions are also worthless in the boss fight, use them only to level up!
- CYDSTEPP and getting the Poison Blade from a shop is a lucky break.
- Make sure you unlock as much as you can before undertaking this quest as it makes it much, much easier.