Normally you take as many precautions as possible to avoid deleting a database - because to do so would usually be a big mistake. But if you really need to delete a database, you can do it in a completely "authorized" way by using this menu item.
You will need this function only in very special circumstances, because when you delete a database, all of the companies, reports and so on that are stored in it will disappear. If you do choose the function unintentionally, you will get a chance to cancel it before any damage is done, because the database will not be deleted until you have confirmed that you really want to delete it.
Click File, Database, Delete.
Opening Databases on Microsoft Dynamics NAV Database Server
Opening Databases on SQL Server