Krauser is the mean-looking Russian commando with the red beret. The first encounter is nothing more than action commands. The second encounter, you can kill him. For this battle, the weaponry you need is the semi-auto rifle and the Broken Butterfly. These two should be maxed out, with exclusives and everything else. If you are short on resources, worry more about getting the Broken Butterfly's exclusive, as it really increases the firepower. In the room where the long and hardest fight takes place, just run to the edge, taking the contents of a barrel along the way. Jump down the edge. Run across the corridor-like area until an intermission sequence starts, Krauser will tell you where Ashley is (not really) and say that you need three insignia to open the gate. He will say that one is in the north and in the east, and that he has the last one. Then, he will show his TMP. After that, the battle starts. Use the rifle to peg him in the head, but be quick. When he shows himself, he does not leave a big window of time to hit him. After about one or two shots he will engage close quarters. The best thing to do is take out the magnum and hit him anywhere. One shot and he will throw a flash grenade. From there, continue. There is a building at the end of the first fight with Krauser in this battle. Ignore the ladder. It is a waste of your time. Open the door and proceed. Turn the corner to find Krauser again. Keep the magnum out. He will be on a building, sniping you. Run toward the building. Use some caution when he starts with the mine arrows. When you are close enough to the building he will jump down and begin close quartering again. Hit him with the magnum. If you do not hit him the first time he may get close enough to use his knife. Either back up to avoid the hit, or (if becomes surreal and he tries to hit you multiple times), enter the action commands as they appear to avoid a slash or a deadly stab to the heart. After he throws another flash grenade, go to the right of the building and walk along the side. It is a path to the next fight with Krauser. This is also where you get the first insignia. In this fight, Krauser will switch between sniping and close quartering. While he is sniping, get under the roof he stands on and enter the action icons to avoid the grenades. When he gets down, aim and shoot. It will be a little tricky because the laser does not show up on Krauser, and you may need to wait until he says, "Come on! Come out and fight like a man!" The important thing is to shoot him. After he throws another flash grenade, a statue will rise. Push it to the square on the other side of the broken wall. This will open up two switches to be used; one to get out of the area you are in and the other to carry on to the last fight. Flip the first switch and go back down the path. When you get to the building, go around the backside of it and go straight to the second switch. Be careful. Krauser will be waiting for you around the corner, heading toward the switch. This starts the second to last shuffle. Just shoot him with the magnum. Open the door and jump down. You see that there are bombs around. Shoot them at a safe distance. Proceed through this trench to the end, shooting any bombs or flying turrets you encounter. Near the end of the path, Krauser will say something and you will have the choice of responding. In the tower at the end, climb the ladder. At the top you can go to the other tower and pick up some ammo and an herb if desired; or collect the second insignia and start the last fight. Krauser does not use his weapon anymore. However, his left arm turns into a group of blades. The fight will commence with an action command. You will dodge if you hit it correctly. You will hang on the edge if you do not. If this happens, press X to get up. The weapon you use is your choice. The magnum is recommended, as you only have three minutes to kill him and get out of the room. This is where timing and aim counts the most. The shooting order is as follows: feet, head. You can use the rifle to get him down, but for the head shot, it is better to use the magnum. If done correctly, you should kill him in a little over a half a minute. After he is dead, go down the ladder, and through the newly opened gate. Jump down, put in the insignia, and leave.
To easily defeat Krauser's final form, when his arm is mutated just use your knife whenever his guard is down. It is possible to defeat him in a little over a minute under the pro difficulty setting by using this technique. Additionally, when fighting Krauser, instead of wasting ammunition, use your knife. You should only have to hit him four or five times before he dies.