will-o'-the-wisp; ignis fatuus
A mysterious, floating flame often seen in folklore, typically in wetlands or graveyards. Sometimes associated with spirits or supernatural phenomena.
I heard a story about seeing a will-o'-the-wisp in a graveyard at night.
Will-o'-the-wisps are sometimes scientifically explained as spontaneous combustion phenomena.
Compound of 鬼 (oni, 'demon') and 火 (hi, 'fire'), literally 'demon fire'. The exact historical origin is uncertain, but it is a traditional term for mysterious lights in Japanese folklore.