We report the observation of large ($sim 40%$) laser-induced above-bandgap transparency in GaAs at room temperature. The induced transparency is present only during the pulse width of the driving midinfrard laser pulses and its spectral shape is consistent with a laser-induced blue shift of the band edge. Our simulations based on the dynamic Franz-Keldysh effect reproduce the salient features of the experimental results, demonstrating in particular that the amount of the band edge shift is approximately given by the ponderomtive potential.