Is the demon of lies hung in mid death animation, with light coming out? That can happen in an unpatched game if a trap or summoned creature delivers the killing blow, and possibly (IIRC) if he is killed by a weapon with Frost on it. Try reloading and killing him again yourself, as Isorun suggested, or install the
patch (probably not worth the download unless you will be playing again at some point).
You could also try using an area effect spell that doesn't need a target (such as Hell Spikes) on the demon, though I'm not sure if that would help.
