Negate First Strike is one of the many Unit Abilities available in Master of Magic.
When a unit with this ability is attacked by an enemy possessing First Strike, that First Strike ability is ignored: combat is handled as though that attacker does not possess First Strike.
Five different Normal Units possess Negate First Strike. All five are either Pikemen or Halberdiers, of various types.
There is no way to add Negate First Strike to a unit that does not already possess it.
Description
In the sort of medieval-style combat occurring in Master of Magic, various types of cavalry and other fast units can charge in for a kill, causing damage to the opponent before that opponent can react. That confers some protection to the charger: if it can kill several opponents immediately, fewer will be left to deal retaliatory damage.
To counter this age-old tactic, some units utilize weapons and training that allow them to prepare for a charge, presenting it with a wall of sharp, long spikes. This breaks the charge, and forces the cavalrymen to fight on more equal terms. Thus, Negate First Strike deprives the enemy of its ability to deliver damage prior to straight-up hand-to-hand combat.
Effect
The Negate First Strike ability is only triggered in a specific situation: When the unit possessing this ability comes under attack by an enemy unit possessing First Strike.
Normally what should happen in such a case is that the enemy unit gets to deliver all of its Melee Damage and any available Touch Attacks before the defender gets to react at all. Thus, the enemy unit can eliminate several of the defending 
figures immediately, reducing the defender's strength during the ensuing Counter Attack.
Negate First Strike units, however, temporarily disable the enemy's First Strike ability. Thus, if a First Strike unit attacks a Negate First Strike unit, combat is handled in the "normal" order, with both units delivering Melee Damage and Touch Attacks (if any) simultaneously - neither gets the advantage.
Note that the attacker may still deliver Thrown Attacks, Breath Attacks and/or Gaze Attacks before the exchange of Melee Damage. These are not affected by Negate First Strike.
Also note that Negate First Strike does not permanently disable the target's First Strike ability. The effect applies only when a First Strike unit goes up against a Negate First Strike unit, and disappears immediately after the attack is over.
Units with Default Negate First Strike
First Strike is a fairly-common ability among a specific type of Normal Units, namely the Pikemen and Halberdiers - though not all types of Halberdiers possess this ability. In total, only 5 units possess Negate First Strike:
Gnoll Halberdiers
High Men Pikemen
Lizardmen Halberdiers
Nomad Pikemen
Troll Halberdiers
These units are fairly important early on in the campaign, especially against enemies using plenty of Cavalry or other units possessing First Strike.
Acquiring Negate First Strike
There is no known method of adding a Negate First Strike ability to any unit that does not already possess it, whether by spells or by Magical Items.