Remember those books you read?
The talisman can neutralize the fireballs.
Walk up to the tree-thing, while avoiding fireballs and the water monster. Then put the talisman on the altar at the foot of the tree-thing.
It's not over yet. The tree-thing is still alive.
Since it's like a tree, it's probably made of wood.
Wood is very flammable.
Throw the lit lamp at the tree-thing.