I've got something in my inventory that I can't identify.

[Frodo-Baginses]

Whilst touring around on various quests, I've picked up a dagger called "Kahvozan's Fang".

I cannot find any reference to it on the wiki or in the extensive game guide.

It's definitely a quest item because I cannot drop it from my inventory.

Anybody got any heads up on this and what has to be done with it?

[Aarah]

This Dagger is used for the Alteration Ritual Spell quest. This quest is only obtainable when you reach a skill level of 90 in Alteration.

You can't drop it before completing the quest, but you should be able to display it in a case or on a weapons rack if you want it out of your inventory.