Diabolos begins the fight by accusing you of being in cahoots with the White Mages of Amdapor. The civilization was known to be powerful mages that meddled with power that eventually proved their undoing. Thus, my guess is that they, the ancient White Mages, pierced the veil between the realms to the void. Bringing him here, where, as the quest goes, he fed on and destroyed the people. Then, the city, stagnant and filled with evil, was sealed by the elementals. As E'Sumi Yan says, "These dark stirrings we have traced to the lost city of Amdapor in the South Shroud. The city once throve in the fullness of magic during the Fifth Astral Era, but it was sealed in the wake of its demise."

As to what he is, Raya-o-Senna says of him, "the elementals tell us all was undone by what the great one calls 'an unclean presence.'" My current theory is that he is a lord of the Void, something more than just another voidsent. Plus, given his history, being the true Lord of the Void would be very consistent with what he is. I'm guessing we've not seen the last of him, because as he's thwarted he says that he's awoken too soon, and is not powerful enough. My guess, he'll be summoned back by someone, and he'll be much stronger next time. Think Hard Mode dungeon.

Also, I've noted that many of the monsters in the city are able to heal themselves very well. Then, there are artifacts there called White Magestones, that heal the Baalzephon (I've got nothing here, its a god of the north as far as the ancient Semites were concerned). My guess is that the Baalzephon, Warmoura or maybe many of the monsters of Amdapor once were the White Mages of Amdapor and were twisted by their encounter with Diabolos much as the ancient Nymians were by their Plague.