Forest of Perpetual Night and Terrible Dangers
From the Super Mario Wiki
The Forest of Perpetual Night and Terrible Dangers is seemingly inhabited by dozens of creatures, the eyes of which are only ever seen. The trees of the forest are also extremely horrific in appearance and a large, seemingly mystical lake is located in the middle of the forest.
The Forest of Perpetual Night and Terrible Dangers is apparently located extremely close to Cramalot Castle, as evidenced by Mario, Luigi, Toad, Princess Toadstool and Mervin the Magician being able to leave the forest and reach the castle in a few minutes by walking.