Razor sharp crystalline projectiles are fired from this elaboreately designed Covenant weapon, and it is widely believed that they use heat and organic signatures to home in on targets. Although easily deflected by energy shields, the needles cause a chemical reaction in close proximity resulting in an explosive effect.

NOTE: Hello needler, my old friend. Here we see a neat explanation of why the weapon works the way it does: that it seeks not only heat, but also "organic signatures" which I suppose explains why it doesn't track other hot bodies like vehicles. Bungie keeps saying the needler will become an effective weapon, when really what it has been all along is Halo's best weapon for just having fun in campaign mode, since its explosions alternately inspire awe and laughter. However, in multiplayer, it's about the last thing you'd ever pick up. Will Halo 3 change that, finally? It remains to be seen.