Party G.R.E.N.A.D.E. is the reward from the Slashdance loot card found in booster packs from the Drums of War expansion set. 

When used, the Party G.R.E.N.A.D.E. creates an AoE buff that causes everyone in the radius of the “explosion” to start dancing for 1 minute. The grenade also comes complete with confetti and streamers to get get the party started and to keep it rollin'.

The Party G.R.E.N.A.D.E. affects players of all factions within its radius.

This item affects all NPC's, including players' pets (as long as they have a dance animation)! Toss it near a hunter with a cat or bear pet and watch it catch dance fever. 

G.R.E.N.A.D.E. is an acronym for Goblinoid Resonant Electro-Neutral Automatic Dancing Emitter.