Examples
The liger is a hybrid animal that is the result of crossbreeding between a male lion and a female tiger. Ligers are the largest breed of cat. Similar to a liger, a tigon is a result of crossbreeding a male tiger and a female lion. A wolf dog is a more common hybrid animal. It is the result of a dog and a wolf mating. A zorse is a hybrid resulting from a cross between a horse and a zebra, while a zonkey is the offspring of a donkey and a zebra. A cama is a hybrid animal resulting from the crossbreeding of a llama and a camel. A cama must be created using artificial insemination because camels are too large to naturally mate with the smaller llama.

Reproduction
Significant differences in the chromosome numbers of parent animals used to produce hybrid animals can often result in the hybrid being infertile. Often, the female hybrid animal can become pregnant, though not easily, while the male hybrid is completely sterile. Liger and tigon males are both sterile hybrids; female tigons and ligers are usually fertile. The mule, which is a result of crossbreeding between a female horse and a male donkey, is also sterile.


Reasons
There are several different reasons for the existence of hybrid animals. Hybrid animals are almost always result from intervention by people; hybrids rarely occur in nature. Sometimes, breeders intentionally create a hybrid animal for entertainment reasons (to display) or out of curiosity. Other times, scientists purposefully breed two different animals for research purposes. These types of breeding experiments can help scientists learn about the genetics of an animal or pair of animals. Occasionally, if similar species of animals are kept together, such as at a zoo, hybrid animals can be accidentally created.

In Nature
Though very rare, hybrid animals can exist in the nature without the intervention of humans. One type of hybrid animal that has been reported in the wild is a wolphin, which is the result of crossbreeding between a female dolphin and a male false killer whale, which is an animal similar to the common dolphin but larger. Members of the animal family known as the Candid family, including wolves, coyotes, and foxes, are known to occasionally crossbreed in the wild. Though extremely rare, scientists have found a hybrid resulting from the natural crossbreeding of a polar bear and a grizzly bear in northwest Canada.

Chimeras
Though sometimes listed as a type of hybrid animal, a chimera is not a true hybrid. Chimeras are the result of two genetically different cells being fused together to form one embryo. Interspecies chimeras cannot occur naturally; they are created within laboratories. For example, a Geep is the result of scientists combining a goat embryo with a sheep embryo. Mouse/rat chimeras have been developed. Similar to hybrids, the two species being used to create the chimera must be closely related enough to produce a surviving embryo. Chimeras generally have 3 or 4 "parent" animals. If the embryo has four "parent" animals, it is a result of two separate fertilized eggs being combined. If the embryo has three "parent" animals, it is the result of a fertilized egg combined with an unfertilized egg or an already fertilized egg combined with another sperm cell.

No not all animal hybrids are sterile. Although the biological definition of a species is "two organisms which can produce viable offspirng" this is not always the case in nature. In some cases the offspring of two different species (aka a hybrid) can still reproduce.

In some cases the female hybrids are more likely to be able to reproduce. One such example is the Liger (a cross between a male lion and female tiger).

The problem with hybrids is that some such as ligers or tigons only occur in captivity. Because the lions and tigers have been geographically separated (they live in different parts of the world generally) for so long they can be justified as separate species based on their morphology so the biological definition of a species isn't always accurate anymore. The point being that naturally in the wild it is hard for these species to reproduce to make hybrids in the first place so the hybrids do not exist in the wild and therefore will only be able to reproduce in captivity.

sources: ehow,yahoo