The Diablo Loot Pinata was unveiled by Blizzard as an April Fool's joke in 2008.
Here's the official caption:
- The Diablo Loot Pinata provides the same fun and excitement as traditional pinatas while also letting longtime Diablo players relive their epic battles with the Prime Evil. In place of candy, the Loot Pinata’s adorable shell is stuffed with fully functional replicas of iconic Diablo items* and artifacts. Parents will be delighted to know that instead of the empty calories and sugar rushes yielded by typical pinatas, their kids will be getting additional exercise while they re-enact their favorite Diablo moments, such as the burning of Tristram or the slaughter of the Zakarum priesthood, all while using authentic weaponry from the game.
It was assumed that this was just a one-time joke, but there has been a sighting in Diablo 3!
In the secret level Whimsyshire, a Diablo Loot Pinata can sometimes be seen hanging from a tree somewhere in the level. It does not seem to be a guaranteed spawn, and the location seems random as well.