Feeding it to your puffle will cause a small Golden O' Berry to appear above its head and a golden ring around it, and will grant them the ability to search for golden nuggets.
Your puffle will have the Golden O'berry until you stop walking him, find all the nuggets, or log off.
A Gold O'Berry was an ingredient for making potions during the Medieval Party 2013
Gallery
What a puffle looks like after eating a Gold O'berry