Upon finding what's left of the missing locals, you should receive a message indicating that you need to clear the cave of all the Trolls. Continue through the cave playing the role of Troll-Slayer. You will need to clear all the trolls from both the first zone of Swampy Cave and from the second zone, Swampy Cave Dry Rock Run.
When you have battled all the available Trolls you will get another pop up message telling you to report back to Drarana Thelis.
Make sure that you have a save that you can reload before you start. This quest is notorious for being broken. If you leave the cave before killing all the trolls some of them can 'follow' the adventurer outside and run off into the wilderness, thereby making the quest broken.
If the game doesnt allow you to continue the quest then just reload.