The Ice Castle is a secret area accessible from the Edge of the World, behind some trees. During the Goblin Wars, the goblins built the castle somewhere closer to Goodheart, but it was later moved to the ice lands by a powerful wizard. When Dink explores the castle, it is inhabited by various monsters (dragons, slayers, boncas...) and a crazy wizard who thinks the goblin wars are still being fought (possibly the same wizard who moved the castle).
During his conversation with the wizard, Dink mentions that the goblin wars ended a hundred years ago. The validity of this claim is somewhat questionable, as the guards in front of Goodheart Castle say that it was thanks to the current king's strategic brilliance that they won the goblin wars.