Final Fantasy Tactics Walkthrough

This battle can really set you back if Loffrey succeeds in breaking any of your equipment, so attack him with your own weapon-breaking skills first, using those from Meliadoul and Orlandeau, as sacrificing support abilities in favor of Safeguard is a pain (but, of course, an option if you need it!). One of these two characters should have Excalibur to get that handled quickly.

Note the gaps in the map, as those are unwalkable tiles that can interfere with your ability to get into range for any of the attacks you're trying to execute at the start of the battle.

Once you've eliminated his weapon, go after Loffrey with strong ranged skills, using Divine Ruination, Holy, and Hallowed Bolt, because if you linger long enough to let those five mages all go off at once, you can be in a mess of trouble.

Take the mages out if you can't get to Loffrey, but only dropping him will end the battle so don't spend much time on other targets unless you get yourself into a tight spot or otherwise can't do anything useful.

Once Loffrey is down, he'll finish his incantation and suck all of you down into the Necrohol, where the end is getting closer and closer. Don't forget to re-equip if the strategies above didn't work out quite right for you, as the battles won't get simpler from here if you show up without, say, some armor.