Mercutio seems to fear and respect Tybalt. When he finds out that Tybalt has issued a challenge to Romeo, Mercutio says that Tybalt is a formidable duelist, and a very tough man to fight. He compares his fighting skills to a virtuoso singer, and praises his mastery of the techniques of sword fighting.
He fights as you sing pricksong, keeps time, distance, and proportion; rests me his minim rest, one, two, and the third in your bosom! the very butcher of a silk button, a duellist, a duellist! a gentle man of the very first house, of the first and second cause. Ah, the immortal passado! the punto reverso! the hai!
This foreshadows an actual duel between Mercutio and Tybalt, in which Tybalt kills Mercutio (though that is really Romeo's fault, not Mercutio's.) In any case, it is clear that Tybalt is not a man to be trifled with, and we also get a sense of the violence that seems to surround every aspect of life in Verona, stemming from the feud that serves as the backdrop for the play.
In William Shakespeare’s Tragedy of Romeo and Juliet, the conflict that sets everything into motion is the long-standing family feud between the Montagues and Capulets. If it wasn’t for this feud, Romeo and Juliet would have no impediments to their ambitions, and their eventual deaths probably would not occur.
The feud is so important to the story that Shakespeare actually opens the play with it, as men from both houses encounter each other in the streets of Verona and very nearly come to blows.
In act II, scene IV, Shakespeare continues to develop the feud as Mercutio, having just learned of Tybalt’s intention to duel Romeo, speaks of Tybalt in terms at once complimentary (regarding his swordsmanship) and disparaging (calling him “a very good whore”).
But note that before he does that, he first addresses the idea that Romeo has already been defeated by Rosaline, because he is helplessly in love with her:
Alas, poor Romeo! He is already dead, stabbed with a white wench’s black eye, run through the ear with a love song . . .
Mercutio describes Romeo in terms we would normally expect to hear in a situation of violence and murder. It is almost as if he is saying that it doesn’t really matter what Tybalt wants to do to Romeo because he is already a lost cause.
The fact that Mercutio does not yet know that Romeo has forgotten Rosaline and fallen in love with Juliet does not bode well for Mercutio’s future, as this will end up creating the situation that leads to his death.