This component is a one-shot thermal fuse. When the body rises above the specified temperature the two leads stop conducting. They’re useful in applications like motors, where you want to make sure power is cut to an overheating piece of hardware before permanent damage happens. They’re pretty simple, but we still enjoyed taking a look inside thanks to [Fatkuh's] video.
The metal housing is lined with a ceramic insulator, which you can see sticking out one end in the shape of a cone. It surrounds a spring which connects to both leads and is under a bit of tension. The alloy making the connections has a low melting point — in this case it’s about 70 C — which will melt, allowing the spring to pull away and break the connection. In the clip after the break [Fatkuh] uses his soldering iron to heat the housing past the melting point, tripping the fuse. He then cracks the ceramic cone to show what’s inside.
The only problem with using a fuse like this one is you’ll need to solder in a new component if it’s ever tripped. For applications where you need a fuse that protects against over current (rather than heat) a resettable polyfuse is the way to go.