It's in the Fields of Slaughter, Ballistae fight area. Save the old man and he will open the chest. You must create a Staff of Herding to find Whimsyshire. When you enter the Secret Level of Whimsyshire a Feat of Strength along with a Banner and Sigil are unlocked. Whimsyshire is a Secret Level, or secret land, in Diablo 3. Submitted by: Samuel-IGN Secret Level: Whimsyshire The game director, Jay Wilson, is an elite monster, and killing him grants the hidden Feat of Strength achievement Smash! Jay, Smash! along with a Banner Sigil. In Development Hell the normal Risen Dead enemies are named after the Diablo III development team, with their descriptions being their job title. When going into one of these there is a random chance it will instead take you to Development Hell. In Act I during the quest A Shattered Crown, there are three areas named Defiled Crypt you can go into, one of which has the quest goal.
Development Hell is a secret area in Diablo III.