Shadow is a boss in Ty 1 within the Cass' Crest level. She is the mother of Shade.
Avoid her bat attacks while you hit the nearby buttons which activate steam to fluster her.
Ty and Shazza confront Shadow with Shazza holding a Talisman. Shadow then swipes both the Talisman and Shazza, so she can deliver it to Boss Cass and then kill Shazza afterwards. When Ty defeats her and she flies away, Shazza kisses Ty for saving her life. Shadow is never seen again.