Cheese Dragons are not actually alive. They are enchanted items of food that act almost identically to dragons. They have no need to eat, but they must “live” in humid environments or they will dry out and harden.

While the scroll-bearer was seeking unique treasures around the coasts of Galsreim, he found a rather strange food. The "egg" had a tough shell and was inedible, so he put it into his bag and brought it with him. Several days later, he was surprised to find that the food had not rotted, so he took a small crunch out of the food, only to taste the ocean's salt. Before he could take a bigger bite, the cheese started moving, transforming into a dragon-like hatchling with basic features. It found the scroll-bearer's bag cozy and stayed there, scenting his bag with cheese. Eventually, it "grew" into an adult dragon, and looked much like one. It seems to have a mind of its own, as it never wants to leave its caretaker. He would tell Saltcheese to sleep in his bag until he returns, then he leaves his bag in his isolated hut somewhere in the mountains (and equips a second bag). Every time he takes a break from his adventures, Saltcheese is one of the few dragons that would play with him.