Early in the game, I pretty much decided that stealing was for the birds. Every single time I tried to steal from a shopkeeper, my thief would get whacked.

Well, Im here to tell you that stealing actually becomes possible in the later stages of the game. You have to get your pickpocketting skill enormously high, then slug down a Master Thievery potion, but it can be done.

Problem is, respectable shopkeepers don't like to deal in stolen (ie fenced) goods. There are two options to get around this. First, steal some expensive items, then either sell it to some Rogue-type merchant (They come out at night)
or simply stack your fenced items underneath a properly purchased or looted item. As long as the legitimate item is on top of the stack, the entire stack can be sold to a regular shopkeeper... including your stolen items.

Tehmpus says tho shalt not be without money!


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Tehmpus Thales the permanently InSaNe

If your having a problem stealing from shope keepers cause they go mad here's what you can do:
As soon as you get caught pause real quick, pause even before you get to the game screen. If the shop keeper's circle is still blue.. talk to him.. then keep on stealing..
It's kinda tough to do but can be done.

An even easier way would be to take it to the shadow thieves guild in the docks - they buy all 'stolen' goods - no questions asked. Kinda makes sense, huh?