The duel between Merlin and Nimueh occurred on the Isle of the Blessed. When Arthur Pendragon got bitten by the Questing Beast, Merlin was forced to go to the Isle of the Blessed where he met Nimueh again. Merlin offered to give his life to save Arthur's. Nimueh instead took the life of his mother Hunith, while Arthur was saved. When this happened Gaius visited Nimueh and gave his life, saving Hunith.
Merlin rode to the Isle of the Blessed in order to save Gaius, but when he arrived it was too late. Merlin framed Nimueh to have organized all of this to take her revenge on Arthur, Gaius and Camelot. She told the young warlock that they were too valuable to each other to be enemies, but when she said she would be the one to make Arthur king, Merlin attacked her with magic and cast a blast of magical energy stretching out his hand. Nimueh stopped his spell very easily, as she was a powerful High Priestess of the Old Religion.
Nimueh then started sending him fire balls and she apparently emerged victorious when she hit Merlin and injured him badly. Assuming him to be dead, Nimueh began walking away, but he soon recovered. The duel finally ended when Merlin struck her with a bolt of lightning, revealing that he had mastered the power over life and death. By doing this, he sacrificed Nimueh's life to the Old Religion in order to save Gaius' (Le Morte d'Arthur).