So you are probably looking at the list of reagents for Skull Ale and thinking to yourself, where the frig am I going to get a Cyclops Skull? Well, actually there is only one place for you to get a Cyclops Skull and that is from an Undead Cyclops in South Karana. The Undead Cyclops isn't that difficult of a mob to kill, you can most likely solo him if you're level 30 or above. As for getting him to spawn, it is said that "an escaped Splitpaw Gnoll" is a place holder for him.
Your best bet for finding him is focus on those gnolls and keep an eye out for him. The good news is you will only ever need one skull then you can make as much Skull Ale you want without every having to find another one. If you're to lazy to farm for the Cyclops Skull yourself you can also go to South Karana and /ooc that you're looking to buy it. Or of course you can always try Commonlands for anyone that has skilled up their brewing and doesn't need the skull anymore.
Aside from Brewing the Cyclops Skull is also used in some armor quests, you can find them on Allakhazam's if you're interested. The only quest I found that it is used in is the Helm of Ro quest which is a paladin quest for a +8 wis helm. You could probably buy something in commons for pretty cheap that is better than doing the quest for the helm.