We report on the XMM-Newton observations of the young, 102 ms pulsar PSR B1706-44. We have found that both a blackbody plus power-law and a magnetized atmospheric model plus power-law provide an excellent fit to the EPIC spectra. The two scenarios are therefore indistinguishable on a statistical basis, although we are inclined to prefer the latter on physical grounds. In this case, assuming a source distance of ~2.3 kpc, the size of the region responsible for the thermal emission is R~13 km, compatible with the surface of a neutron star. A comparison of the surface temperature of PSR B1706-44 obtained from this fit with cooling curves favor a medium mass neutron star with M~1.45 solar masses or M~1.59 solar masses, depending on two different models of proton superfluidity in the interior. The large collecting area of XMM-Newton allows us to resolve a substructure in the broad soft X-ray modulation detected by Chandra, revealing the presence of two separate peaks with pulsed fractions of 7 +/- 4% and 15 +/- 3%, respectively.