Ground flax seed is a great source of essential fatty acids also known as Omega 3. Agree with all comments.
I grind my flax seeds in my Vita-Mix dry container and freeze them as Susang says. Much cheaper to ground your own, and they retain their nutrients. Once ground they can quickly become rancid, which is why freeze them.

Whole flax seeds are not digested and come out as they went in.

You can grind the flax seed at home -- most people use a designated electric coffee grinder. I make about a cup at a time and store it in a sealed container in the freezer. You can also buy preground seeds.
Flax seed has a long history as a laxative. Uncle Sam's Cereal is one of the oldest commercial breakfast cereals, made from bran flakes and whole flax seeds.

Here is a nice summary of the difference between ground & whole - basically some people thing that there are more nutrients available to you after the flaxseeds are ground because the whole seeds aren't broken down during the digestive process.

read more here : http://www.mayoclinic.com/health/flaxseed/AN01258

Ground flaxseed is simply pulverized flaxseed. It can be used as an egg substitute in muffins and other baked goods (for each egg, mix 2 tablespoons of it with 2 tablespoons of water and let it sit for 10 minutes). It's also an easy way to get more flax in your diet -- you can sprinkle it on your breakfast cereal or add it to granola!