Ring of Khajiit Location - Morrowind
Location: Vivec, Arena Hidden Area
Requirements: Able to open a lock level of 50 // a method of invisiblity/sneak/chameleon
Video: How to get the Ring of Khajiit
Reaching Taros Dral: Arena Waistworks to Arena Canalworks; on the western side of the Canalworks there will be a door to Arena Storage in the Arena Storage behind a locked door there will be a locked trap door to Arena Hidden Area (Video of me coming here)
The Ring of Khajiit is a reward for completing a quest from Taros Dral found in the Morag Tong Guild Hall in Vivec. You don't actually need to be a member of the Morag Tong in order to accept or complete this quest - though if you are a member you'll want to be extra careful because the target you have to kill is a member too. Here is a Video Walkthrough of this quest if you'd prefer that to the written guide.
Speak with Taros Dral about sensitive matters to start this quest, he'll tell you to go to Balmora and place Treated Bittergreen Petals in Balyn's Cauldron without being seen by Balyn. He wonders around out front of his house just across the river in eastern Balmora. Unlike many of the other quests in this game you actually have to be sneaky for this one. Having high Sneak or Invisibility/Chameleon will help for this part.
In Balmora next to Caius' house (on the eastern side of town) you'll find a trap door ontop of the building that leads you into Balyn Omarel's House. The door will be locked with a lock level of 50 and there is no one inside the house. Don't steal anything while you're in here or you may bug out the game - just place the poison in the pot and leave.
Return to Taros Dral in the Morag Tong Guild Hall and talk to him about the sensitive matters again - if you were successful in not being seen then you'll be told to interact with the Altar of Mephala to complete the quest and be given the Ring of Khajiit reward.