Defeat the Evil Emperor, Leo.
Now, it's time to face Leo, who is taking the form of some kind of Monolith. He actually, just stays there, in the air, not moving or attacking. However, fireballs form in the air around him, and will head after you, although they aren't hard to dodge, most of the time.
You'll notice that word bubbles are coming up from the ground. Grab one, and shake it, to cause it to go from bad to good. For example, by shaking the word "Rage" you get "Peace". Throw the newly formed word at Leo, and it will hurt him. After about seven hits, the Monolith will be destroyed.
Wait for a bubble with the word "Dire" in it, and shake it. It will become the word "Lucky". Throw it, and a golden gem will fall out.