A squirrel named Peanut who was propelled to the heights of internet fame has been euthanised after biting a New York government staffer.

With 537,000 followers on Instagram, the domesticated black squirrel had fans worldwide who delighted in his exploits, such as nibbling on waffles and wearing tiny costumes.

New Yorker Mark Longo said he rescued the animal after seeing its mother killed by a car, going on to bottle feed the baby squirrel before attempting to release him into the wild.

However, the animal lost part of its tail and returned to Mr Longo, living with him for seven years and starring in posts on the Instagram account peanut_the_squirrel12.

"Internet, you WON. You took one of the most amazing animals away from me because of your selfishness. To the group of people who called [the New York State Department of Environmental Conservation], there's a special place in hell for you," Mr Longo wrote in an Instagram post.

He said he was "in shock, disbelief, and disgusted … for the last seven years, Peanut has been my best friend".

The Chemung County Department of Health and the New York State Department of Environmental Conservation (DEC) said in a statement on Friday, local time, that Peanut, along with a raccoon living with Mr Longo, were possessed illegally, and had been euthanised to test for rabies.

"On October 30, DEC seized a raccoon and squirrel sharing a residence with humans, creating the potential for human exposure to rabies," the statement said.

"In addition, a person involved with the investigation was bitten by the squirrel. To test for rabies, both animals were euthanised."

The department called on anyone exposed to the animals to consult a doctor.

Mr Longo wrote that "the fight goes on" and called on supporters to donate to his legal bills and plans for an animal sanctuary.

AFP