He delighted in creating havoc, and was jealous of the Doctor's ability to do so. He learnt magic to increase his ability to cause chaos, planning to outdo the Time Lord. When he went to Hyspero to gain more power, the magicians there changed him from a man into a green elephant, in hopes of teaching him stability.
The lesson failed, and he took over the city of Valcea. He stole an egg from a group of intelligent owls. He had it hatched and adopted the child who came from it, calling him Icarus. The boy was later kidnapped and hidden on Earth.
Daedalus used his powers to extend tunnels from the Enclave into other universes, with the conflicting physical laws disrupting those realities. Icarus was eventually returned to him, but the owls attacked and killed the boy, since their god had told them not to allow the egg to hatch prematurely.
The Eighth Doctor tried to stop this, but Iris Wildthyme took him, Fitz and Compassion back to Earth. Since they had not gone to the Enclave in the TARDIS, the Doctor did not know the coordinates to return and Iris would not give them to him. So the Doctor never found out what happened to Daedalus after they left. (PROSE: The Blue Angel)