To begin The Black Star, enquire about rumors from the innkeeper in Whiterun and you’ll be told about a shrine to the Daedra Lord Azura, the location of which will then appear marked on your map. Travel to the shrine and you’ll find a single Dunmer priestess named Aranea praying before it. She asks you to find someone she saw in a vision, who she says can “turn the brightest star as black as night”, and suggests you look for this enchanter in Winterhold.
Go to Winterhold and talk to any of these townsfolk: Colette, Dagur, Drevis, Faralda, Mirabelle, Nirya, Phinis, Tolfdir, or Sergius. They all direct you to an elderly Elven wizard who is currently staying at the Frozen Hearth Inn. Go to him and either: (Pursuade) inform him that a priestess of Azura sent you, (Bribe) pay him for his information or (Intimidate) pressure him into talking.
When you get him to cooperate, Nelacar, for that is his name, begins to explain about Azura’s Star. Unlike a regular soul gem, this artifact allows any number of souls to pass through it. Nelacar discovered this while he was in the service of his former master, a powerful wizard named Malyn Varen, who was experimenting with the item in the hope of preserving his soul and saving himself from the imminent death facing his disease ridden body. The power of the star slowly made Malyn paranoid and impulsive (although Nelacar believes that Azura herself was responsible for that), resulting in the deaths of several of his students and the banishment of Nelacar to somewhere called Ilinalta’s Deep. If you want to recover the Black Star you’ll have to go there.
Locate the fort of Ilinalta’s Deep and enter through the trapdoor at the top of the sunken turret. Make your way through the dungeon fighting off the attacks from necromancers – the remnants of Malyn’s students. Eventually you’ll reach a large spiral staircase, at the top of which you’ll find the final resting place of Malyn Varen. Search the room to find Azura’s Star, which appears to be broken, and escape the dungeon via a nearby ladder.
This quest has two conclusions for you to choose from:
Take the star to Aranea at the shrine
If you return the item to Aranea, the Dark Elf woman you met at the shrine of Azura, the Daedra herself speaks to you and tells you that Malyn Varen’s soul is inside the Star, and until it has been driven out, the item is useless. She offers to send you into the Star to confront Malyn. You are spirited away into the Star, and after telling Malyn that he cannot escape his fate, a battle commences. When he falls, his soul is consigned to Oblivion and yours is transported back to your mortal body in Skyrim. The Daedra now gives you Azura’s Star as a reward – it is a reusable grand soul gem – and you have the option of taking Aranea with you on your quest as a follower.
Take the star to Nelacar at the inn
If you return the item to Nelacar at the Frozen Hearth Inn, he’ll examine the Star and discover that Mayln Varen’s soul is trapped inside of it. He says that he can repair the broken Star, transforming it into a vessel that stores black souls. But first, Malyn’s soul must be purged from the device, and to do that, you must be soul trapped into it so you can face him. You are spirited away into the Star, and after telling Malyn that he cannot escape his fate, a battle commences. When he falls, his soul is consigned to Oblivion and yours is transported back to your mortal body in Skyrim. Nelacar now repairs the artifact and you can keep the Black Star – it is a reusable black soul gem.
NOTE: “Black souls” refers to the souls of humanoid life forms such as townsfolk, the Foresworn, or bandits that can’t ordinarily be stored in standard soul gems. Like the souls of other life forms, they can be used for enchanting purposes.