Cedar apple rust is an important fungal disease of apple in North America east of the Rocky Mountains. It can defoliate trees and blemish fruit making them unmarketable. The fungus requires two hosts, apple and eastern red cedar (Juniperus virginiana L.), to complete its life cycle. Spores produced on apple do not infect apple, but only cedar and spores produced on cedar infect only apple.
I assumed that this gall was caused by some kind of gall wasp but this is actually a fungus.