tSR Compo Vol. 9: Enviromental Hazard

[NICKtendo DS]

Does it have to be made up entirely of tiles?

It's a choise. You can make a tileset, an asset or both (basically make the asset part of the tileset).
You can make a beautiful 160x160 tree if you want, or a rock. Tileset is optional; it is useful for creating enviroments.
In a way, a single 160x160 tree is a 32x32 tileset of 5 tiles high and 5 tiles wide, though chances are none of them can be properly repeated.