916) Bring up childhood fears, in idle conversation. Admit your own, let your players tell theirs. Casually ask what their characters fear.
Three months later, have the characters break into a tomb. A coffin, perhaps of stone, or some odd material (Jade?) is in one corner. They open it.
That night, have a PC roll a will save against a Nightmare spell. Describe the nightmare paticularly. Repeat this, as they go on down their adventure (Take characters aside, when doing this perhaps). Now, while they're having a fight with an enemy, traveling through boring situations, having NPC RP, have them make a Will save. If they fail, (Let us take the example of snakes) a snake is crawling up their leg. Do this repeatedly.
Start throwing Suggestions at the party, as well as covering PCs with illusions of that fear. As well as Fear spells, and finally, Phantasmal Killers.
If the PCs aren't going nuts, attacking eachother, or hiding, and they're using True Seeing, have them find an Incorperal being hovering amid them. The steady fear that they've been enducing has been Feeding him. He's now a Nasty Incorperal Outsider.
917) Let them kill him.
Repeat, 3 months later.
917b) Have one character have a nightmare, three months later. It's just a nightmare.