We present Hubble Space Telescope imaging of a newly-discovered faint stellar system, PAndAS-48, in the outskirts of the M31 halo. Our photometry reveals this object to be comprised of an ancient and very metal-poor stellar population with age > 10 Gyr and [Fe/H] < -2.3. Our inferred distance modulus of 24.57 +/- 0.11 confirms that PAndAS-48 is most likely a remote M31 satellite with a 3D galactocentric radius of 149 (+19 -8) kpc. We observe an apparent spread in color on the upper red giant branch that is larger than the photometric uncertainties should allow, and briefly explore the implications of this. Structurally, PAndAS-48 is diffuse, faint, and moderately flattened, with a half-light radius rh = 26 (+4 -3) pc, integrated luminosity Mv = -4.8 +/- 0.5, and ellipticity = 0.30 (+0.08 -0.15). On the size-luminosity plane it falls between the extended globular clusters seen in several nearby galaxies, and the recently-discovered faint dwarf satellites of the Milky Way; however, its characteristics do not allow us to unambiguously class it as either type of system. If PAndAS-48 is a globular cluster then it is the among the most elliptical, isolated, and metal-poor of any seen in the Local Group, extended or otherwise. Conversely, while its properties are generally consistent with those observed for the faint Milky Way dwarfs, it would be a factor ~2-3 smaller in spatial extent than any known counterpart of comparable luminosity.
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