The Bird Necklace is a Key Item in Xenoblade Chronicles. It is an item required for Search Quest 1 on Bionis' Leg, a quest acquired from a female refugee in the Refugee Camp.
To get it the party must go all the way through Kisk Cave, the cave just outside of the Refugee Camp on the right. At the other end is an elevated patch of land where there are several Tirkins. On the right there is a red light, the necklace. If the quest has been accepted, the item will appear as a red exclamation mark on the mini map.