A nor'easter is a strong cyclonic storm which travels up the East Coast of the United States and Canada. They happen most often in winter because they feed off cold air, although nor'easters can happen at any time of year. When the centre of the storm is just off the coast, the counterclockwise rotation of the low pressure system means that the leading winds always come from the northeast.
What makes a nor'easter strongest in winter is the mixing of warm Gulf Stream air with cold polar air. Temperatures inside the storm plunge when the northeast wind hits, bringing bitterly cold rain and snow with it. As the storm passes, temperatures rise behind it.
Most nor'easters start their life cycle in the Gulf of Mexico. From there, they hitch a ride on the jet stream up the east coast, where they also tap into the warm Gulf Stream current. If the warm air of the budding storm meets cold polar air, the storm intensifies. This usually starts happening somewhere around North Carolina. However, intensification happens mostly when the Arctic Oscillation is in its negative phase. When the Arctic Oscillation is in its positive phase, it bottles up the cold air behind it, so it can't reach the storm.
If the centre of the nor'easter leaves the Gulf Stream and goes inland, it won't meet up with the coldest air or the cold Labrador Current. Usually that means that there's a lot of rain or snow, so it can cause flooding, close airports, and cause serious traffic problems if there's a lot of snow. However, the temperature and pressure differentials aren't really big with a landbound nor'easter, so there isn't a lot of wind to make things even worse.
It's a completely different story when the centre of the storm stays offshore. As long as the nor'easter is tapping into the Gulf Stream, warm moist air keeps mixing with cold arctic air so it can keep right on intensifying. As it heads further north, the difference in temperature keeps rising, making the storm larger and more and more powerful. By the time it reaches Canadian waters, the winds can be at strong hurricane speed.
In addition to even heavier snow or rain and hurricane-force winds which can reach far inland, an offshore nor'easter will bring flooding and destructive storm surges. Because they are usually very large and follow the coastline all the way up, the riptides associated with nor'easters also cause much more coastal erosion than most hurricanes.
In this kind of nor'easter, the pressure gradient is so strong that it can develop a feature which looks like a hurricane's eye. It's not a hurricane because its core is cold, not warm. It also doesn't have a closed circulation.
However, a nor'easter during hurricane season can pull a hurricane into its warm water convection. This was what happened during the Perfect Storm of October 1991. The Perfect Storm then went on to do something nearly unheard of. As Hurricane Grace was torn apart by the cold air of the nor'easter, another part of the nor'easter pulled in the warm air and started a closed circulation. By November 1, the nor'easter had developed into a brand new hurricane.