Nana is Lulu's Shugo Chara.

You find out most about them form around episode 88-89. When Lulu was little, she couldn't make up her mind about what she wanted to be when she grew up, and that's when Nana was born, as she was coming out, she said "just do all ya wanna do" then same thing Lulu says when extracting a ? egg. In episode 88 when Nana was sick, she accidently told Amu (who was sleeping-over) along with her charas that Lulu was the one extracting the ? eggs