The decrease in apparent viscosity that occurs when a suspension, such as blood, is made to flow through a tube of small diameter (observed with blood in tubes less than about 0.3 mm in diameter). The effect appears both in living systems (blood flow in the capillaries) and in mechanical, non-biological suspensions like glass beads in salt solution (see Vladimir Vand, j. Phys. Chem. 1948). The fahraeus-lindqvist effect becomes stronger as the tube diameter decreases relative to the size of the particles.
The viscosity of suspensions depends on the volume fraction of the suspension which is solid rather than liquid, as well as on the viscosity of the liquid phase itself. However, close to the tube wall the volume fraction is reduced, because the particles only touch the wall at one or two points. ( think for example of a sphere resting on a flat plane. Only a small part of the sphere is near the plane surface. )
Therefore the "suspension" near the wall is almost pure liquid, and is less viscous than the suspension as a whole. The extra fluidity near the wall accounts for the extra flow in narrow tubes, compared with the flow predicted by poiseuilles law. The viscosity of the suspension is not uniform -- it varies with distance from the tube wall, and is a minimum AT the wall.