One of the key items people will need to get during the Genshin Impact Lantern Rite events is the Xiao Lantern. This is essentially a sort of in-game event currency. For example, people will need one each time they want to participate in the Theater Mechanicus tower defense minigame. Now, miHoYo shared what goes into one.
To start, people will need to take on a special quest called The Origin of the Lanterns in Liyue Harbor. You’ll learn the crafting recipe for the item after. If you go to the crafting bench near Timaeus in Mondstadt or next to the Teleport Waypoint in the southern half of Liyue Harbor, you can make a Xiao Lantern if you have the right materials.
There are three things you need to make a Xiao Lantern for the Lantern Rite events in Genshin Impact. Fortunately, you only need one of each component to make one. You have to combine Lantern Fiber, a Plaustrite Shard, and Wick Material together. miHoYo noted where all three come from in-game.
Lantern Fiber can come from plants. It cited Mint and Sweet Flower as two sources, both of which are found throughout Mondstadt and Liyue. (Though you won’t find either really in the Dragonspine area.) You will also need 50 Mora to craft one.
The Plaustrite Shard comes from ore outcrops and geo-aligned enemies. Both Iron Ore and White Iron Ore deposits can be found rather frequently around the path between Wolvendom and Stormterror’s Lair in Mondstadt. Meanwhile, the geo-related enemies like the Geovishaps and their Hatchlings can be found in Liyue around Tianqiu Valley, Cuijue Slope, and other southern parts of the map. (Liyue’s Stonehide Lawachurls can drop them too.)
Finally, the Wick Material sounds like it could be a rather common item to find. miHoYo said Hilichurls and Fatui elite enemy variants might drop them. Hilichurls can be found in every area of Teyvat. Fatui members can rather reliably be found in the Dragonspine area, though you can also happen upon them in Liyue as well.
Genshin Impact is available for the PlayStation 4, PC, and both Android and Apple iOS devices. It will also come to the Nintendo Switch. The Genshin Impact Lantern Rite events will begin on February 10, 2021.