Mao's a pretty powerful demon--Aurum, who has fought many Overlords and evil gods, even said that he believed Mao could become the strongest Overlord to ever live. What's Mao's capable of can be kind of vague, but his threat to destroy the human world is taken pretty seriously and in the Human World ending, he accidentally destroys the entire universe while attempting to get rid of the human world. However, even without nerfs it's unlikely for him be able to tap into that power as he is.

Mao displays a few personal battle abilities in the game, which include:
Blast Finger - Essentially, Mao charges up some green energy, throws himself towards his opponent, and blasts it in their face.
Shine Beam - Mao creates a bunch of blinding white energy beam/laserthings that continue to intersect and grow larger until they finally disappear.
Vasa Aergun - Basically consists of Mao turning into a giant monster("wouldn't fit in the station" big) and shooting energy beams at people.

the TL;DR version of all of these attacks is: "Mao is good at shooting really vague destructive energy beams at things."

He's also pretty decent at ice magic, and has been shown to be able to drop huge chunks of ice on people and freeze them solid. He can be equipped with a variety of weapons in the game(sword, spear, axe, and a magic staff--but he's capable of performing his ice spells regardless of the weapon he's using), so it's fair to assume that he at least knows the basics of wielding all of them. He's shown to favor a sword above other weapons.