A TorchFlame actor is a type of Light (UT), which is shaped like a fairly large flame. It uses a FireTexture and is volumetric?. Place this actor over a brush shaped like a torch (such as one made with the VolumetricBuilder) and it will light up a room with a neat flickering effect.
Note that in UT torches cannot burn you, if you teleport or jump on them. If you want to correct this, I guess you could make a LavaZone over it and set ZoneInfo → bWaterZone to false.