Appearance:

She appears as a tall, deathly pale young human woman, with short black hair, and hard, cruel eyes.  (There may be some initial confusion if there are vampires common.)  Despite this, most people don’t pay much attention to her.  This, of course, suits her just fine.  She looks somewhat sickly, but she’s much, much tougher than she appears.

Background:

Phobia is the daughter of the demons Insanity and Fear.  When the demons were running amok, before they were bound into the Tanglewood Box, they had both possessed humans, and… well, the results are self-explanatory.  Phobia is half-demon, and half-human.  She is not immortal, as her parents are, but her expected lifespan is possibly on the order of millenia.  She was too young to prevent her parents from being bound into the Box, and later could not find the hiding place of it.  But once the Box is found, perhaps by foolish adventurers (who will almost certainly open it), she will make it her business to find and destroy the thing, to release her parents, and nothing short of her death will stop her.  She is skilled in black magic (necromancy), and has some of the innate traits of her parents.  She has an affinity to all things evil, and is a skilled manipulator.  Unlike her parents, the Tanglewood Box, or either of its predecessors, has no effect on her, nor do items that work strictly on demons or strictly on regular mortals.

Roleplaying Notes:

Phobia has a definite sadistic streak, and takes after her parents.  She likes to sow terror and drive people mad, preferably at the same time.  Although she rarely is physically involved (she likes to set things up like a chain of dominoes, trigger it, and then sit back and laugh while everything goes to Hell), she really has no objections to, say, killing and torturing people herself.  It is possible that she could orchestrate several plots, manipulating the villains’ activities from behind the scenes, and no one (including the villains) would have a clue she was doing it.  (She may appear to be one of the villain’s henchmen or minor lieutenants, and her involvement is only revealed very much later, if at all.)

While her parents are more powerful than her, Phobia has centuries of experience that they don’t.  She will be drawn to her parents if they escape the Box, and the three of them could quite possible plunge the world into an everlasting nightmare, full of poor, deranged souls, given enough lead time.  She would make a very good Shadowy Maleveolent Figure, Evil Overlord, or what have you.