Most often it is because the parents of the hybrid have different numbers of chromosomes. During meiosis, some of the chromosomes cannot pair up, so they cannot produce sperms or eggs. Conversely, if both parents have the same number of chromosomes, then the hybrids may be fertile. In other cases though the same number of chromosomes may not result in fertility if the two species are just too different morphologically.

They all have issues. Usually, even if a hybrid species animal isn't sterile itself, its offspring after another generation or so are.

The production of gametes is impaired in sterile animals because the sorting of chromosomes is unbalanced, in nonsterial ones the hybrids produce functional balanced gametes.

If the chromosomes in hybrid animals can bend themselves into the shapes necessary to pair with each other given their mismatched genes, the animal can be fertile. If the chromosomes cannot make the necessary bends, they animal will be sterile.