I never really payed much attention to it when I first played Oblivion years ago. But I was playing it again recently and found myself in Anvil.

I knew this statue of a Mermaid was sort of like a centerpiece there. It's in the northeast corner of the city, and no one talks about it as far as I'm aware. It was just now that it really dug into my head that it was a Mermaid. Yet I never hear about Mermaids...

http://i.imgur.com/VxfhhNh.jpg

So, is there lore on Mermaids? What is this?

Sheogorath realm also has mermaid statues.

I would blame Sheogorath whenever mortal's imagination goes out-of-universe then create something like that (mermaid).

Other than that...

A mage did it? *slaps herself* No seriously, what if a mage actually experimented on a woman, trying to fuse one half of her body to a (slaughter)fish, using magic such as Alteration, Restoration and whatever made Falmer's soul white instead of black. And then it turned into a tale exaggerated and dramatized, and the statue is the result of that silly tale.

Eh.

Or... she's actually Tsaesci, with her tail depicted wrong.

EDIT: I'm going with CaptainG idea. They are Lamia. It fits really. Creature of underwater and all.

Well, there are Lamias, and they look somewhat like a mermaid. Other than that, I don't know if there are "real" mermaids.

Link: http://uesp.net/wiki/Lore:Bestiary_L

I don't see why not. We have plenty of other mythical creatures after all. Nothing in the lore would prevent Merpeople from existing.

Wereshark prehaps?