Flexible-shelled eggs of the lizards Phrynocephalus przewalskii and P. versicolor were incubated under different thermal and hydric conditions to elicit the effects of incubation environment on hatching success, embryonic development and duration as well as hatchling phenotypes. Embryogenesis of the two species was not sensitive to changes in the hydric environment except P. przewalskii incubated in 30°C group. Temperature significantly altered the duration of embryogenesis, with cooler temperatures leading to a longer incubation period. Hatching success was greater at 26 and 30°C than at 34°C. The hatchlings incubated at 26 and 30°C had longer snout-vent length, larger body mass, and better locomotor performance than those incubated at 34°C. Compared to P. przewalskii, P. versicolor had a shorter incubation period and yielded smaller hatchlings, which then had a higher survival rate in cooler and drier habitats. We conclude that an incubation temperature of 30°C would produce the best balance among developmental rate, hatching success, and post-hatching performance. We speculate that the upper temperature limit for incubation of P. versicolor eggs may be slightly higher than 34°C.