The Ye Olde Inn is located in the district of Southwest Baldur's Gate. The Flaming Fist Headquarters is next door and the Potion Shop and a general store are located across the street.
When you first enter, it is being overrun by five green slimes. The bartender is covered in green slime and in the process of being dissolved. He gets out one last message to you before he dies.
| “ | Leave this place! Ungh! There be green slimes rising... rising from the cellars! Flee while you—*gasp*—still can. | ” |
— Bartender | ||
With the proprietor dead, Ye Olde Inn is just a building with a few Commoners wandering about in a stupor - if you saved any. If any of the patrons survived you can question them to discover that the mage Ramazith is responsible for the green slimes. There is no quest related to Ramazith and the slimes but he can be killed without consequence during the quest The Captive Nymph.
| “ | Whoa! One moment the barkeep was talking to the mage Ramazith, then all of a sudden he's flamin' mad. He summoned up all those slime creatures. Hideous things they were. | ” |
— Patron | ||
Besides the melting bartender, there are six commoners and four green slimes in the main room and one commoner and one green slime in the kitchen. Killing a green slime gives your party 65 XP but no loot. There's a barrel in the kitchen with 15 
in it. There are six empty containers upstairs. There isn't an actual cellar where these slimes supposedly came from.