The Key to the Magical Prison

Use
After killing 45 monsters during the Magical Prison quest, you can open the door in the Lonely Barrow location with it. The number of "charges" left in the ingame description of the item shows the quantity of the creatures left to kill.

Source
Found together with the Unholy Flail +4, Message from the laboratory of Farnirras and Diary of Farnirras the Pensive in the hidden (in your Capital) underwell laboratory of Farnirras after the Uncanny Well throne room event.