Obtain an enchantment scroll via the Arakas quest for the enchantment scroll.

Equip yourself with a Dark Heart Necklace, dropped by Bane Gwengad, located in his castle on the island to the North-West of Raven's Dust.
Find a Demon Skull, dropped by Grioresh, the demon from Jarko, as well as a Chaos Sword.

With 8,000 Gold Pieces, go to Lance Silversmith, the blacksmith in Arakas, located South-East of the island with two bridges, and tell him forge a demonic blade.

• Demonic Blade
• Karma Reduction