In the film's finale, Ae-ran, acting as a tool for the red eye, has lured Cheong-seok and Jin-soo to the temple where the black eye was originally interred. Now that it has possessed Dong-jin, the only thing the red eye needs to do to complete its mission is to possess the sacred protector of the black eye. Jin-soo believes these duties have fallen onto him, so he sets out to create a spiritual trap for the demon by using himself as bait.
However, when the possessed Dong-jin arrives, the demon reveals that because Jin-soo was never formally ordained as a monk (one of the reasons he left the order), he's not the black eye's protector. That task falls on Cheong-seok. The demon possesses the younger monk and traps Jin-soo against a tree. As the apocalypse begins to ramp up, the demon gives Jin-soo the opportunity to revel in vengeance. Earlier in the movie, we learned that Jin-soo's family was killed by a drunk driver who later killed herself, leaving behind her child. That child, it's implied, grew up to be none other than Cheong-seok.
Appearing in the form of the child, the demon tells Jin-soo to kill it and satisfy his rage. Instead, Jin-soo uses the blood from his injuries to draw a magical incantation on the child's face. This throws the demon off. It leaps from Cheong-seok's body into Jin-soo's body and when it does, Cheong-seok is able to kill it with an enchanted ax and put an end to the forthcoming apocalypse.
In the end, the earth is spared annihilation and the red eye is returned to its original resting place. While the stakes of "The 8th Night" are global in scale, in the end, it's the intimate personal struggles of the characters that really mattered.
If you or anyone you know is having suicidal thoughts, please call the National Suicide Prevention Lifeline at 1-800-273-TALK (8255).