You can find the Double-Edged Sword in Endor’s castle, hidden in a secret locked door. You’ll need a Magic Key to find this cursed weapon. It’s recommended to get it as soon as you get the Magic Key, as this weapon is more useful during the early game.

Finding the Magic Key

You’ll have to revisit Aubout du Monde during Chapter 5 and head to the cave to the west where you originally found the Sphere of Silence in Chapter 3. 

After you reach the same place where you found the Sphere of Silence, examine the empty chest to unlock some stairs that take you to a secret lab. You can break the jars to get a Mini Medal and a Seed of Resilience. Open the chest in here to find the Magic Key. With this key you can open all locked red doors in the game!

Getting the Double-Edged Sword

With the Magic Key in your pockets, head to Endor. enter the east gate, following the path to the Colosseum. At the end of this path there is a red door on the left side that you can see if you rotate the camera. Open that door, walk through the pathway and get up the stairs in the middle. 

After going through a small pool of poisonous ground and another set of stairs, you’ll reach a secret room with three chests. Open the chests to get a Seed of Strength, a Mini Medal and the Double-Edged Sword.

Congratulations! This sword can be equipped by the Hero, Ragnar or Psaro if you unlock him in Chapter 6. It gives you +99 ATK, a number much higher than any other weapon you can find so early in Chapter 5, however, as with every cursed item, it has a negative side: the wielder takes 25% of the damage he does with every physical attack. 

The high attack value makes it a decent sword in the early game though, even if we take into account its cursed effect; you can just heal the wielder every couple of turns. It loses its value once you find the Liquid Metal Sword, the Zenithian Sword, or you get enough gold to buy the Flail of Destruction.