When does the demo of terraria end on Xbox? I'm not sure exactly but I summoned the Eye of Chutulu and I was about to hit it and the game froze then sent me to the dashboard. If this is where the demo ends why don't they tell you?
The Terraria demo appears to be fully functional, with a couple of limitations:
- The world is much smaller (Some people are saying it's 1/10 of the small world)
- There's no character/progression saving
As for what happened to you, I'm guessing you were unlucky and the game crashed. There are a few people reporting similar experiences with the full game on the Terraria forums: