"Apple has determined that, in very rare cases, the battery in the iPod nano (1st generation) may overheat and pose a safety risk. Affected iPod nanos were sold between September 2005 and December 2006.
Apple recommends that you stop using your iPod nano (1st gen) and follow the process noted below to order a replacement unit, free of charge.
Note: This battery issue is specific to the iPod nano (1st gen) and does not affect any other iPod.
This issue has been traced to a single battery supplier that produced batteries with a manufacturing defect. While the possibility of an incident is rare, the likelihood increases as the battery ages.
How do you know whether you iPod Nano is first generation?
It will have a black or white plastic front, and a silver metal black (later iPod nano models have a metal front and back)
If this fits your iPod nano - visit the Apple website here for details on how to get a replacement model free of charge.