The Giant Beetle is another one of the results of the failed Decay spell cast by the Meer. It can be found in the Solen Hice along with some of the other creatures changed by the spell.
The Beetle is quite a strong and fast fighter, when it is hit with a ranged attack it will run towards its attaker with an incredible speed until it catches up and hits him.
Once it has taken enough damage it will be beaten into subjugation, which will allow animal tamers to tame it. Due to the beating the Beetle will lose a great deal of its Stats and Skills when tamed.
Once the Beetle has been tamed it can be used as a mount AND as a pack animal, which like a Pack Horse can carry 1600 stones. Because it is both a mount and a pack animat it requires 3 control slots to own it. No taming skill is required to own or ride it.
If the Beetles pack is very full and you mount it, it will become overweight and you will not be able to move very fast without it running out of stamina.
(The Beetles pack can be accesed by using its context menu while you are not mounted)