Progression in Terraria is defined, in part, by beating bosses. That's why each boss (save the Slime King) drops something that's crucial for advancement, or otherwise is necessary for accessing something important. The Eye of Cthulhu drops Demonite ore, which is incredibly rare otherwise. The Eater of Worlds drops Shadow Scales, which are necessary for most of the useful Demonite gear. Killing Skeletron is necessary for accessing the Dungeon, where all manner of useful things are found. And killing the Wall of Flesh activates Hardmode, as well as drops the Pwnhammer, which is vital to getting the Hardmode ores. What's interesting is the end-game loot. There are three Hardmode bosses, and each one drops a specific type of soul. Later on, there's Plantera, Golem, and finally the Lunar Events. You have reached the end of the game's progression when you have defeated these bosses, and thus have access to just about any item you could want. The ultimate item would therefore be the one that requires, as crafting material, an ore dropped by the very final boss. And what is it? Is it the Meowmere and Star Wrath, the ultimate swords? Is it the SDMG, the ultimate ranged weapons? Is it the Last Prism, Lunar Flare, or Rainbow Crystal Staff, the ultimate magic weapons? No. It's the Drill Containment Unit. Why? Because that's what Terraria is about. It's not about killing monsters, even though obviously that's a big part of it. It's about mining through the ground. And thus, the game is ended when you have access to the ultimate mining tool(s), capable of deconstructing anything that can be deconstructed.
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