Note: After you complete this quest, every representative of the order will become hostile towards you. It is best to complete this quest right before you leave Fort Joy Ghetto, but you can complete it earlier, if you are sufficiently strong to defeat the Magisters.
Right after the game starts, you may notice the magical blue collar that blocks your necklace slot and you can see it even after you wear a heavy armor. The aim of the collar is to inhibit your magical powers (Source).
Upon reaching Fort Joy Ghetto, you can investigate whether you can remove the collar, however, you have to keep on mind that within the Fort you are considered a prisoner, and the collar is the only indication of this fact. Before starting another assignmnent gather your team, as an inexperienced character might have certain difficulties with carrying it out on his own. .
The size of your team does not mattes, as is Fort Joy Ghetto you can remove the collar only from your character (Method 1: Arena of the One). Should you decide to remove all collars, you have to push the story forward (Method 2: Sanctuary of Amadia).
1. Fort Joy Ghetto - Nebora
2. Camp Kitchen - Entrance to Arena of the One
4. Sanctuary Of Amadia - Leya
Method 1: Arena of the One
Near the fort gate, there is a small house. Right next to the house, there is Nebora, who is not interested in your presence and, additionally, she does not want to talk to you. You can ask her about issues connected with her trade and you will learn that she was involved in the building of collars just like yours. Regardless of the dialogue options you pick, she will not want to remove the collar because, in her opinion, you are not worthy.
To change that, you should go to Camp Kitchen. Near Amyro's cage, there is a path down into the Arena of the One. The location is small and you should have no problems finding individual NPCs/ To take part in challenges of the arena, you should talk to the character in the center of the room (The Thorny One).
After a short conversation, you will get to the arena proper. Here, you will have to face the challenges. If there are four characters on your party, the battle should not amount to much of a challenge, but it is better to save the game, just in case.
After you win, you will be brought to the pedestal and you will be able to return to Nebora. If you still have not completed the quest that will allow you to teleport your party, it is best to return here after you have done that. You can teleport one of the characters to the arena to loot the corpses of the defeated party and two chests.
Return to Nebora and tell her about your victory. After a moment of admiration of your capabilities, she will offer to remove your collar. You can agree immediately, or wait until the moment you will be ready to face members of the order.
Reward: removal of the collar
Method 2: Sanctuary Of Amadia
When completing the Nothing But Child's Play quest or during the exploration of the Island, you will encounter Sanctuary Of Amadia . There, you get to meet Leya, who can remove the collars from the other members of your team. Do not do this, until she learns what happened to Gareth (see the Most Dangerous When Cornered quest). After completing this quest return to Leya. If you did not manage to save Gareth you have to possess Broken Source Collar Amulet, which can be found next to his body. Then, she will remove the collars from all your team members.
Eventually, after this quest is completed, you will be able to use more powerful spells if you manage to find them.
Reward: Removing the collar