In Dungeon Defenders you get a reward item after completing a challenge level. Additionally, I have heard that Medium/Hard challenges give a different reward from Insane mode. I'm trying to find out what rewards come from each challenge, and on each difficulty.
Here is the list from the wiki. This is a CW so anyone can update if it changes.
As far as I know, easy challenges have no rewards, and medium/hard challenges have the same rewards.
No Towers Allowed:
Death from Above
Halloween Spooktacular: Rewards are class based