The Grave Elemental (Lord) is found in the Sinking Graveyard of Blackspore Swamp. Like Emily said, it's a hard encounter, and they aren't joking.
I did it in beta with a 15 Brawler. The most important part of this fight, aside from bring LOTS of potions, is to destroy the skulls on the ground as quickly as possible whenever he pulls one out. If not, you'll be unable to damage him, but he'll certainly still be dishing it out on you.
Also, avoid the fire he pops out, it HURTS!