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The Fire Demons are the inhabitants of Muspelheim and are ruled by Surtur. When Thor had unintentionally let loose the dangerous beast known as Mangog, his foster brother Loki told him that the only way to truly defeat the creature would be to infuse his hammer with the metal known as Scabrite, which could absorb large amounts of heat. So Thor ventured into the flaming realm of Muspelheim, Surtur's realm and the one place that was abundant with the Scabrite metal.
It was there that Thor realized that it was Surtur's sword that had the Scabrite he needed. However, Surtur would not give it to Thor willingly and he engaged the son of Odin in an intense and tough battle.
Eventually though, Surtur was no match for Thor and his control over wind, thunder, and lightning. Surtur was eventually defeated and Thor destroyed Surtur's sword in order to collect the Scabrite he needed.
Thor escaped from Muspelheim, but was followed by the Fire Demons. Along with the Frost Giants of Jotunheim, they launched an attack on Asgard. Under Thor's leadership, the Asgardians were able to defeat their foes.