Mama jumps off the cliff with just Lilly, and upon hitting the branch, Mama and Lilly turn into a shower of butterflies. The movie ends with Victoria realizing that one of the butterflies watching over her is in fact Lilly, perhaps referencing a ghostly regret of Victoria not going with her.
Lily is her replacement of her lost child, and by taking her away, they were enacting Mama's unfulfilled wish and death scene.
