In cuprate high-temperature superconductors the small coherence lengths and high transition termperatures result in strong thermal fluctuations, which render the superconducting transition in applied magnetic fields into a wide continuous crossover. A state with zero resistance is found only below the vortex melting transition, which occurs well below the onset of superconducting correlations. Here we investigate the vortex phase diagram of the novel Fe-based superconductor in form of a high-quality single crystal of Ba0.5K0.5Fe2As2, using three different experimental probes (specific heat, thermal expansion and magnetization). We find clear thermodynamic signatures of a vortex melting transition, which shows that the thermal fluctuations in applied magnetic fields also have a considerable impact on the superconducting properties of iron-based superconductors.