Chakra Scalpel

This medical technique forms one's chakra into a small, sharp blade. This can then be used for highly accurate incisions necessary for surgeries and anatomical dissections. Unlike regular scalpels, the Chakra Scalpel can actually make cuts inside the body without actually creating an open wound, limiting the risks of an infection.

The Chakra Scalpel can also be used offensively, although it requires great precision to be effective. Because of this requirement, using the Chakra Scalpel offensively is highly unusual. In heated combat, even the greatest medical-nin won't be able to exert the precision needed to make fatal cuts, but it can still effectively cut muscle tissues and tendons, rendering the target immobile.

In Part II though, Kabuto's skill with the jutsu was enough to cut through wood and flesh with ease.

Trivia

 * Although it is usually written in Katakana, the part of the name was given kanji when it was first introduced. It was written as, which would usually be pronounced as "Chakura no Kaibōtō".
 * Shizune uses this technique as a major portion of her fighting style in the Ultimate Ninja game series.