When he kicks the skull, a voice tells him to leave the skull alone. It's a tall black man dressed in Indian garb, covered in soot and carrying an axe. He asks what Tom is doing on his grounds; Tom sneers at him that this land belongs to Deacon Peabody, not to him. The man tells him to "look yonder, and see how Deacon Peabody is faring," pointing to a rotting tree that has Deacon Peabody's name scored into it. Another bares the name "Crowninshield." Both of these are men who acquired wealth through dishonest means.
The man says this land belonged to him long before any of Tom's people claimed it. Tom asks who he is, and he says he goes by various names; he is the wild huntsman in some countries, the black miner in others, but here he is known as the black woodsman. He says that Indians consecrated this land in his name, and since "white savages" exterminated the Indians, he is their great patron. He also says he presides at the persecutions of Quakers and Anabaptists. Tom realizes that this is the man commonly called "Old Scratch."
In this story Old Scratch is not merely representative of the devil; he is the devil incarnate, the devil in the form of a dark man who roams dismal places such as this swamp near the Charles Bay and seeks to punish those who acquire wealth dishonestly and oppress and persecute other groups.
You may have noticed that the devil is portrayed as a dark-skinned man, while Tom, whom he corrupts, is a white-skinned colonist. As established before, Tom is by no means a likable white man, but he is white all the same, and pure evil is portrayed as black. This is highly reflective of racial perceptions during the time period in which this story was published. Author Washington Irving wrote "The Devil and Tom Walker" in the early 1800s, and race relations in America were worse than ever at this time. Irving is remembered today as a somewhat racist author, which is reflected in his portrayal of the devil as a black man. Blacks were considered inferior to whites in all ways during this era, and were still being traded as slaves at the time of this work's publication.