Once it is thrown down, Zombies nearby and incoming will pause, then lunge toward it; all except the Female, Athlete, and Hulk Zombie. Once several are gathered around, Zombies crouch and stare, until it explodes, launching them in all directions.
The Bait Grenades are able to stick on anything they are thrown at. It's better when you stick them on explosive barrels.
It is useful for when swarms catch the player off guard, or when defending the gate, where getting Zombies away from the intended target is useful.