Use the Five Rs to restore the iPod. You will lose the data that is currently on it if you restore but you can always re-sync the data to the iPod.
http://www.apple.com/support/ipod/five_rs/
If that doesn't fix it, it's your battery. http://www.ifixit.com/iPod-Parts/iPod-Nano-Gen-3-Replacement-Battery/IF134-005
-=/ Daft Tech /=-
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