Demons and the Sun

Sunlight is one of three things that can kill a demon. The day/night cycle directly shapes when and where you fight.

Spawning

Demons spawn at night or underground where light levels are low enough. There is also an optional Progressive Spawning setting — disabled by default — that restricts demon spawns to players who have learned a breathing style or carry Nichirin items, preventing new players from encountering demons before they're ready.

Sun Damage

Any demon exposed to the sky during daytime takes massive sun damage and burns. Even the strongest demons die in seconds under direct sunlight — a demon wearing any helmet is fully protected, following the same vanilla mechanic as helmeted skeletons. Demons can pick up dropped armor, so be careful about leaving pieces near them.

If a fight drags past dawn, kite the demon into open sky and let the sun finish the job. Underground, caves and covered areas block the sky check entirely, so you get no such advantage down there.