We present a high spatial resolution optical and infrared study of the circumnuclear region in Arp 220, a late-stage galaxy merger. Narrowband imaging using HST/WFC3 has resolved the previously observed peak in H$alpha$+[NII] emission into a bubble-shaped feature. This feature measures 1.6 in diameter, or 600 pc, and is only 1 northwest of the western nucleus. The bubble is aligned with the western nucleus and the large-scale outflow axis seen in X-rays. We explore several possibilities for the bubble origin, including a jet or outflow from a hidden active galactic nucleus (AGN), outflows from high levels of star formation within the few hundred pc nuclear gas disk, or an ultraluminous X-ray source. An obscured AGN or high levels of star formation within the inner $sim$100 pc of the nuclei are favored based on the alignment of the bubble and energetics arguments.