DISPLACER SQUID
For as long as magic has been molded by those of fair and foul intent, experimentation has been part and parcel to the process of development. While many such experiments focus on land, the Displacer Squid is an unusual example of aquatic ingenuity.
Legend has it that a young mage found himself subject to the furious whims of Umberlee ages ago, and in return for his life pledged both service and a gift to appease Her rage. He served as promised until meeting his end embracing the waves in his old age, letting Umberlee pull him to the depth's eternal darkness, and created a monstrous pet for Her entertainment during his work as Her servant for his gift.
Beginning with the form of a giant squid, the mage heavily enchanted it with magics to preserve both its life and enhance its intelligence. Umberlee worked Her own changes to the newborn monstrosity, enhancing it's natural weapons and adding terrifying changes. Amongst these were fang-like hooks added to the already powerfully ripping beak of the squid, enhanced barbs along the lengths of its tentacles and fearsome strength in its limbs.
While the already powerfully enhanced monster might have satisfied Umberlee's conditions and the curiosity of many a mage willing to experiment with life, it did not do so for this particular wizard. Continuing on, he drew inspiration from a rivalry that he had always found curious and compelling; that of the Displacer Beast and the Blink Dog. While perfect translation of their abilities was far from the mage's skill, he worked with what he could.
Firstly, he widened the tentacular clubs at the end of the squid's two feeding tentacles, making them resemble the tentacles of a Displacer Beast. Secondly, they were elongated. An average giant squid's hunting tentacles extend roughly 10 meters (30-ish feet), however with the enhanced strength provided by Umberlee, he was able to increase this to closing in on 70 meters. At this point, he found himself satisfied with the physical form of his treasured work, yet he still had a bit more to add, with Umberlee's assistance. Through the magics of mortal and divine together (fortunately Umberlee was more curious than vicious during the task!) they worked in an unusual power.
The Displacer Squid is capable of sending its hunting tentacles and beak through small portals (likely dimension doors) to attack those who would dare sail Umberlee's oceans. Ships fear the Displacer Squid above nearly all else, for there is no warning; only sudden, terrible destruction. While the two powerful hunting tentatcles wreak havoc on a ships outer shell and those sailors unfortunate enough to be near one's terrible clubs, the monster's beak aggressively targets the seamen themselves. It's massive maw appears suddenly, ripping into its target and tearing gaping chunks out of their flesh, disappearing just as quickly to enjoy the fruits of the bloody feast.
The most effective way to fend off this vile beast is to disable its hunting tentacles in some way, whether by cutting off the tentacular pads or the tentacles themselves. They will regrow in time, but without their aid the beast will often retreat, preferring easier prey. It is difficult to slay a Displacer Squid truly, as it keeps the majority of its mass below the waves in a bid for safety, but a clever combatant could surely find a way to do so with a bit of ingenuity.
Young Displacer Squids (for they are capable of breeding. A mating between a Displacer Squid and a natural giant squid will have a small chance of creating another Displacer Squid) do not have particularly developed control over their powers. While they are still formidable in comparison to many aquatic beasts, they lack the sharp intellect and strategy of adult Displacer Squids, and can be dispatched comparitively easily. A young Displacer Squid reaches adulthood at around fifty years, and it takes another ten to twenty years of practiced hunting before its powers can be used to a finely honed edge.
Displacer Squids are solitary, but due to their enhanced intellect are capable of simple communication. They are not aggressive towards each other, save for when one feels threatened, and they will always communicate this fact clearly to the other before attacking. Their 'society', if it can be called that, is nomadic in nature. They are aggressive towards all other sea life suitable for consumption assuming they are hungry, save for sea turtles, which for some unknown quirk of magic or tradition, they are fond of.
I don't know how to add an image properly yet, but I will upload one when I figure it out!
Full picture:
http://imgur.com/JzEGDIK