Once a challenge has been accepted, the two combatants will direct all of their attacks against one another, in Initiative order. Whilst the challenge is ongoing, other models engaged in the same combat cannot direct their attacks against either of the duelling models.
If possible, the models engaged in the challenge should both be moved through the ranks and placed in base contact with one another, the better to reflect their heroic duel. However, sometimes this is just not practical, so it is perfectly acceptable to leave them in place.