The entire premise of Morrowind places the player in the role of the Nerevarine — the reincarnation of the hero Nerevar, prophesied to defeat Dagoth Ur and free Morrowind from the Blight. The prophecy is ancient, venerated, and repeated by every major faction on the island. It is also, according to the game’s own evidence, fabricated.
The Ashlander tribes believe in the prophecy genuinely. The Tribunal — the three god-kings who murdered Nerevar to steal the power of the Heart of Lorkhan — tolerate belief in the prophecy because they need it to remain vague. The Dissident Priests believe the prophecy was written backward to make someone fit it, rather than to predict someone already destined.
The player character is explicitly not the real Nerevarine — they are a prisoner selected by Caius Cosades because they fit the prophecy’s loose criteria well enough to be useful. The prophecy becomes self-fulfilling because the player acts on it. The game does not hide this: NPCs tell you directly, multiple times, that the prophecy is constructed.
Defeating Dagoth Ur without fulfilling any of the Nerevarine prophecy requirements is possible. The game permits it. The prophecy is scaffolding — it holds the story up while you build what you need, and you can kick it away at any point if you understand what it is.

Currently on my first run and now I have to go back and look for this. Worth the detour.
Found this by accident on my third run. Came here to understand what I was actually looking at. Great write-up.