Board Thread:Lore Discussion/@comment-25291590-20130317093523/@comment-67.61.226.229-20130318130724

I believe the general consensus is that they can't. Argonians, at least, lay eggs, so the idea of the interbreeding with the other races is doubtful.

Then again, rule of thumb in Elder Scrolls is that the race of the mother determines the race of the child when crossbreeding occures. Thats why there aren't any half orcs or half elves(bretons being a specific case created over generations of deliberate crossbreeding, and are still technically men, not mer).

So while it's possible they occassionally produce viable offspring, it would be impossible to tell, really. A khajiit woman impregnated by a human would just have a khajiit offspring, and vice versa. I doubt mating between men/mer and beast races really occures enough to achieve verifiable cases.