On the strategic map, flying units have one additional movement, ignore all terrain penalties when led by a flying commander with only flying units, and are capable of moving over enemy territory and even attacking enemy territory when not adjacent to it.
In battle, flying units instantly move adjacent to the targeted squad when engaging in melee combat. Additionally, when retreating they instantly leave the battlefield. Though they appear to 'teleport,' once engaged in melee combat, they will not break off to pursue other targets the way units with Teleport do. They also gain a bonus to patrolling, sieging (both offensively and defensively), and additional damage on charge attacks such as lances.