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The Skeleton Key is received as a reward for one of the Daedra Shrine quests - Nocturnal, I believe. The shrine is located quite near the road from Impereal City to Leyawin (sp...) - the direct road that is to the east.
i have the reverse question - have found the skeleton key but dont know what you do with it as i was playing with the sound off so missed what was said to me when i finished nocturnal quest and received the key - i assume it opens certain doors? thanks in advance
You do get the lockpick from Nocturnals shrine. I tried it though, and it said she wanted a stronger champion. Make sure you are at a good level before you try it!
~For the shadow will always follow the dark one, for it alone knows the depth of the darkness~