A character can be paralyzed in a number of different ways:

A character who is paralyzed cannot act in any way--no fighting, casting spells, identifying, or using items.

Paralysis can be cured, however, by having another party member cast the priest spell Dialko or Madi on the affected character.  It can also be cured by helping the affected character at the Temple of Cant --for a price.  The cost to cure a paralyzed character is 100 gold per level.

When a character is paralyzed at the end of a battle (whether he was paralyzed during the battle or before it), he is not included in the distribution of experience points or treasure . If the entire party is paralyzed, dead, or otherwise incapacitated, the game will autmoatically kill them off and move to the graveyard scene.