Kobolds remind me of mice, so before 3rd edition D&D (I hated draconian kobolds at first, but slowly grew to love them thanks to the lore), I always pictured little mouse people. They steal things, are extremely cowardly, live in massive groups, and are smarter than they look.
Fun facts about mice, which may or may not apply to kobolds. Most of this applies to rats, too:
They can have more than 16 young in a litter, and can become pregnant in the 24 hours after giving birth. It takes three weeks for a litter to be born, and the new babies arrive just as the old ones are weaned.
They live like two years tops. The oldest mouse ever is five years old and he's on a calorie restricted diet and gets lots of exercise in a laboratory setting. As a tradeoff for this short lifespan, they live their lives in fast forward, going through a higher percentage (by body mass) of calories in a day than even the most active human. They eat a ton to keep up this energy level, and sleep in short increments and are active throughout the day (kind of like living several little days in one of ours).
Mice are fastidiously clean, which is the only way to survive when you have large groups of animals living in confined spaces.
Rats (but not mice as far as I know) can be trained to use tools, but don't do it naturally. Maybe they are copying what the higher races make by stealing the objects, then learning about them?
Mice and rats have extremely poor eyesight, but make up for it with powerful scent and hearing, and a tactile sense via their whiskers that is many times more sensitive than our fingertips.
Old stories of kobolds go back to german copper miners, who would find cobalt that looked a lot like copper ore. This being the middle ages, the only obvious explanation was that a spirit called a kobold did it.
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