Bashiok revealed interesting details about boss fights and lesser mob fights that weren't shown in the gameplay video. These events will have gradual signs to let players know each phase of the fight until a boss dies. Players will be drenched in blood if their character is too close to a dying monster.
Whipper: I think it would be cool if we could see marks on boss when a mellee character slice him with a sword or an axe etc....
We can see that the boss have sword marks and axe marks or that he look tired and he walk slower etc. till he die... I think it could add some realistic aspect to the game and more fun killing bosses
Bashiok: For boss fights we don't really want to just start throwing "damage decals" on them. It can very easily be too subtle if you're fighting a smaller boss or one that has odd geometry to it, and it can also end up that no matter the flavor, style, and cool look to a boss you just end up fighting a big gory mess.
Also we think that we can go a lot further than just simple decals and get something much cooler out of a boss fight. So what we hope to do for at least the bosses where it makes sense is to show more apparent and visually noticeable damage states. Instead of a blood splatter they may actually lose a limb, or a piece or armor, or - like the Thousand Pounder - may transform in some dramatic way changing how the fight progresses. We want to go a lot further than just showing sword slashes and instead use dramatic and noticeable (which can be difficult in a game like this) ways to indicate a boss' current state.
Speaking of battle damage though, and I don't think this came across in the gameplay video or any of the screenshots as of yet, but when an enemy dies a critical death it actually drenches your hero in blood if you're within proximity of the spray. It's awesome.