The chameleon is Agent Gene's vehicle.
Like Gene, it comes from Technopolis and is a high-tech vehicle. As this would make it quite conspicious on the other islands, it can disguise itself and also change its mode of transportation. E.g., in fairyland, it usually gets transformed into a podracer-like plant vehicle, among pirates, it is turned into a pirate ship or when Alex visits home, it looks like a siege engine. The changed look is more than cosmeticalk, though: As a ship, it swims in water, as a podracer it flies etc.
When they first meet Gene and the Chameleon, Alex, Ruby and Twinkle tought the Chameleon was a monster, and its opening door gets confused with the monster's mouth. After this initial shock, the three get acquainted with it quickly.
Part of its equipment is a number of hoverbikes.