Neuraminidase is an hydrolase enzyme that breaks down glycosidic bonds. It is found on the surface of the Orthomyxoviridae1 family of viruses, where it helps to break the bond between the new-born viruses and the host cells.
The first hint that neuraminidase existed was unearthed in the 1940s, when George Hirst found that when allantoic fluid2 infected with the flu virus was mixed with blood, the blood cells clumped up. When the cells were heated, they broke apart, and could not be caused to clump again even when the temperature was lowered again, or with a new injection of the flu virus. Hirst concluded that the virus had an enzyme that destroyed the receptors that the virus attached to on the cell surface. MacFarlane Burnet found that Vibrio cholerae (the cholera bacterium) produced an enzyme that did the same thing. These enzymes were called Receptor Destroying Enzymes (RDE).
RDE was found to leave behind sialic acid after doing its thing, and RDE became known as sialidase. Sialic acid3 is now more often called N-acetyl neuraminic acid, and hence the name of RDE was changed yet again, this time to neuraminidase.
When newly created viruses bud off (wrapped in an envelope of the host cell's own membrane), the neuraminidase is needed to cut the viruses' section of the cell membrane free from the host cell. The virus looks like a sphere (usually) with many tiny projections; these projections include the mushroom-shaped neuraminidase proteins, among many others.
Neuraminidase, along with hemagglutinin, are the two proteins on the surface of the virus recognized by the human body as antigens, and they are also commonly targeted by antiviral drugs (such as zanamivir and oseltamivir). If the neuraminidase is blocked, the newly created viruses cannot break away from the body of the host cell, and the infection stops.
Flu viruses are actually named by numbering the mutations of the neuraminidase and hemagglutinin; it started with H1N1, and now we have H5N1 and H5N2 (variants of the avian flu) and H3N2 (the most common seasonal flu over the last ten years), among many others. H1N1 is usually defined as the 'Spanish Flu' of 1918, which killed over 20 million people.
If you were paying attention earlier, you noticed that the cholera bacterium also produces a neuraminidase protein; being a bacterium, none of the previous three paragraphs apply to it. Apparently Vibrio cholerae uses it to remove the sialic acid from the gangliosides of nerve cells to unmask GM1, the receptor that the cholera toxin attacks.
1. A family of RNA viruses that is best known for causing the flu in humans.
2. Influenza grows really well in the albumen of fertilized chicken eggs; this is one of the best ways to cultivate uncontaminated flu viruses.
3. Not all sialic acids are neuraminic acid; but in this case it is more specific to call the subset of sialic acid that we are working with 'N-acetyl neuraminic acid'.
Flu by Gina Kolata. Farrar, Straus and Giroux, 1999.