The SARS-CoV-2 B.1.1.529/Omicron variant was first characterized in South Africa and was swiftly designated a variant of concern1. Of great concern is its high number of mutations, including 30-40 mutations in the virus spike (S) protein compared to 7-10 for other variants. Some of these mutations have been shown to enhance escape from vaccine-induced immunity, while others remain uncharacterized. Additionally, reports of increasing frequencies of the Omicron variant may indicate a higher rate of transmission compared to other variants. However, the transmissibility of Omicron and its degree of resistance to vaccine-induced immunity remain unclear. Here we show that Omicron exhibits significant immune evasion compared to other variants, but antibody neutralization is largely restored by mRNA vaccine booster doses. Additionally, the Omicron spike exhibits reduced receptor binding, cell-cell fusion, S1 subunit shedding, but increased cell-to-cell transmission, and homology modeling indicates a more stable closed S structure. These findings suggest dual immune evasion strategies for Omicron, due to altered epitopes and reduced exposure of the S receptor binding domain, coupled with enhanced transmissibility due to enhanced S protein stability. These results highlight the importance of booster vaccine doses for maintaining protection against the Omicron variant, and provide mechanistic insight into the altered functionality of the Omicron spike protein.