Loot drops increase with the Stars on a Mob, and which world it is in.
The chance of a Trophy also increases with Stars, except for Bosses where a Trophy is guaranteed regardless of stars.
Multi Star Bosses drop more secondary loot

Roughly speaking , more risk = more reward.

The Colour of the Stars matter

• Magenta - Quick - Moves faster, 40% increased movement speed
• Red - Aggressive - Attacks faster and tries to hit you more often, Attack speed increased by 25%, Interval between two attack waves and circle time reduced by 50%, interval between circles increased by 150%
• Green - Regenerating - Regenerates health over time, BaseHeal = Health at 0 stars * (1 + 0.25 * stars), Healing = BaseHeal * (10 * log(max(10, BaseHeal - 1000)) / (BaseHeal + 1000)) * 1.2 / second
• Cyan - Curious - Comes checking for you from a farther distance, Hear and view range increased by 100%
• White - Splitting - Splits in two lower level enemies with the same color upon death, Example: A 4 star Greydwarf will split into two 2 star Greydwarfs on death
• Blue - Armored - Takes less damage, but moves slower, 66% less damage taken, 50% reduced movement speed