The Mountain Demon was a mythical creature thought to not truly exist, but it played a part in ancient Northern Island lore. However, Bolt the Hedgehog discovered the beast on the summit, and after being attacked by it, took it out.
The Mountain Demon will charge at you, and if you jump out of the way, will get it's head stuck in the ice. At this point, you must use homing attack into his back. You must repeat this process 8 times to defeat the Mountain Demon.
The Mountain Demon can charge at you and pin you against the wall, causing a loss of rings. However, even when being pushed towards the wall, you can avoid this with precision movements. It can also grab you and throw you down.