1.Say I declare military attack with one character with military icon. Then my opponent removes military icon on my attacking character with for example "Locked Away" (Any Phase: Kneel 1 influence to have attached character lose 1 icon of your choice until the end of the phase). I guess he can do it, since it is "Any Phase", so my military challenge is lost right?

2. Longship Iron Victory - Challenges: Kneel Longship Iron Victory to choose a participating character. Until the end of the challenge,that character gets +2 STR. If you win the challenge,draw a card.

Text says "Until the end of the challenge..", so i guess it cannot be used after the challenge resolves?

gaspar said:

If my character loses a military icon in the
middle of a military challenge, is that character
removed from the challenge?

No. Once a character is in a challenge, it can
only be removed from that challenge by an
effect that specifically removes the character
from a challenge, an effect that removes the
character from play, or by an effect that changes
control of that character. Gaining or losing
icons mid-challenge does not affect the attacking
or defending status of that character.

gaspar said:

As a small addendum to your Locked Away question, what your opponent can do is remove the icon in response to you declaring a military challenge, thus making whichever character loses the icon ineligible to be declared as an attacker. This means you'll have to use other characters or, if that was your only MIL icon character, the challenge fizzles.

At least I think that's correct.

Shenanigans said:

Initiating a challenge is part of a framework action window that has two separate framework events:

1. Active Player declares challenge type and opponent
2. Active Player kneels attacking characters

Both must be done in order to initiate the challenge (and the challenge has not officially started until both are complete). Like any other framework action window, you can play no card effects and take no player actions between them. The only thing you could do between #1 and #2 is play an effect that specifically canceled the declaration of challenge type/opponent - an effect that does not exist in the game.

This is the same reason you cannot play events between determining the winner of a challenge and resolving claim or between revealing plots and determining First Player.

So, leaving aside the fact that Locked Away is not a "Response," you cannot "Respond" to the declaration of a military challenge in #1 above with an "Any Phase" effect before #2 happens. There is no place in the timing structure to trigger anything.

If you want the character you have put "Locked Away" on to not attack in a military challenge, you have to use it to remove the military icon before it's controller declares a military challenge. Icon manipulation forces you to anticipate what your opponent might do and take away those choices. It does not let you retroactively undo those choices after they are made.

My bad, for some reason I was thinking it was a response and not an any phase action, and even if it was I was still wrong.

Count on ktom to come to the rescue.