The Data Knife is a tool used by Pilots in Titanfall. All Pilots are equipped with a Data Knife by default. The player can use this tool to hack into enemy Spectres or Turrets, which will then fight for the player. When approaching a spectre drone or turret, a prompt will appear on the player's HUD. Upon holding the action button, the Pilot will stab the knife into a thin connector slot and a counter on the knife will begin to scroll. Upon completion, the Spectre will fight for the player, as well as any Spectres in the surrounding vicinity. The same is true when activating or capturing heavy turrets, although the player must instead find and hack into a control console at the base. Turrets in Fracture cannot be hacked and serve no function outside the campaign.
The Data Knife can also be seen when players are wallhanging, with the knife stabbed into the wall.
The data knife can't be used as weapon, but it can however hack into heavy turrets, which prove quite effective against Titans, as well as having the ability to convert a enemy Spectre squad to fight for the player's team. The major downside to the data knife is that the Pilot, when initializing a hack, will be unable to defend themselves during the duration of said hack (cloaking solves this) - additionally the hacking process can be sped up with The 'Icepick' Pilot Kit.
It appears that the circuitry within the knife that is used to hack turrets and Spectres remains within the knife until a trigger is pressed and the circuitry ejects to the tip of the knife. This would most likely be used to protect the delicate circuitry in the heat of battle.
In Frontier Defense, any hacked Spectres that were under control of a player will die instantly at the end of a round and to limit the max amount of hacked Spectres by only 5; this is to ensure that Pilots do not have a unfair advantage over the IMC.
Ironically, the knife is never used as a melee weapon; the most evidence of an attack with the knife is when hacking a Spectre.