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Skyrim: Skyforge and Skyforge Steel

Skyforge

LOCATION:

If you've discovered Dragonsreach, fast travel there. ( B > MAP > DRAGONSREACH ) walk down the steps, away from Dragonsreach, and take a left at the Shrine of Talos, there should be a short staircase leading up to an oval shaped, wooden house-ish-thing with a hay roof, walk towards Jarrvaskr.

Jarrvaskr

walk up the stairs located to the left of Jarrvaskr, and there's the skyforge

SKYFORGE STEEL:

 Skyforge steel can only be created after becoming a companion, the Skyforge steel weapons are usually 1-2 attack points higher then the regular steel weapons. same goes for the steel armor.