Warning: Contains SPOILERS for The Mandalorian season 2, episode 4, "Chapter 12: The Siege."
The Mandalorian season 2, episode 4, "Chapter 12: The Siege" sees a red-eyed lava meerkat rescued by Cara Dune, and surprisingly reveals it can breathe fire, raising questions as to how these powers work. This is by no means the most fantastical creature Star Wars has ever provided, but there are a relative lack of beasts with fire powers, making this ability relatively unique in the larger universe.
The Mandalorian season 2, episode 4 brings the show back to Nevarro, with Cara Dune taking down a group of Aqualish raiders who are ransacking what used to be the base the Mandalorian armorer resided in. After subduing her opponents, Cara finds a strange weasel-esque creature that appears to immediately take a fondness to the warrior, in no small part because she offers it food.
Though it's not unusual for any Star Wars installment to contain a cute animal, concept art shown at the end of the episode reveal its fire breathing abilities. This does raise an interesting question as to what exactly it is supposed to be, as there aren't an abundance of creatures in Star Wars with the ability to control fire. That said, we have seen this particular type of rodent before, in the first season of the show. The creature is a lava meerkat, a species seemingly native to Neverro, and found mainly in the underground lava caves the likes of which viewers see them on in The Mandalorian season 1 episode 8. The lava meerkats are likely able to breathe fire the same way the Fire-Breathers seen in the Battle of Mantessa are thought to, by having a "fire sack" organ that allows it to release chemicals that result in fire when they react with air.
What is readily apparent about these fire powers is that they cement something that has already been made very clear in The Mandalorian through Baby Yoda's occasional disturbing moments - namely that the cuter a creature is, the more capable it is of wreaking untold havoc at the least expected point in time. While this lava meerkat being is no krayt dragon, it's also not as big a pushover as the Porg, and this makes it clear that in this universe, underestimating even small, pet-like creatures such will still more than likely result in a gruesome demise.
Though breathing flame isn't exactly surreal in a universe where a form of telekinesis is used by many - and the question what any creature is will always be somewhat overshadowed by the question of what Baby Yoda is and when this will be explained - it is still fascinating to see The Mandalorian flesh out the world of Star Wars that extra dose further.