Lizard-Steeds are useful lizards shaped by the Hist to look like large animals commonly used as mounts by the people of Tamriel. The Hist shaped them as such to allow the Argonian people to travel long distances in the swamps. Horses, wolves and the like are not suited for long travel through the deep swamp, but lizard steeds are. Furry mounts can get stuck in the mud, catch sloughskin from fleshflies or eat poisonous flora and die. Lizard steeds do not.
The origin of the Lizard-Steeds is similar to the Argonian's origin. The Argonians simialrly have an allegory known as the Parable of Becoming states that the Hist found the humanoid forms of Men and Mer useful, molding the form of the swamp’s lizards after them to create Argonians.