  We present Hubble Space Telescope images of the He{\sc iii} region
surrounding the bright X-ray source in the dwarf irregular galaxy Holmberg II.
Using {\it Chandra}, we find a position for the X-ray source of $\alpha=$ 08h
19m 28.98s, $\delta=$ +70\arcdeg 42\arcmin 19.\arcsec3 (J2000) with an
uncertainty of 0.6$''$. We identify a bright, point-like optical counterpart
centered in the nebula with the X-ray source. The optical magnitude and color
of the counterpart are consistent with a star with spectral type between O4V
and B3 Ib at a distance of 3.05 Mpc or reprocessed emission from an X-ray
illuminated accretion disk. The nebular He{\sc ii} luminosity is $2.7 \times
10^{36} \rm erg s^{-1}$. The morphology of the He{\sc ii}, H$\beta$, and [O{\sc
i}] emission are consistent with being due to X-ray photoionization and are
inconsistent with narrow beaming of the X-ray emission. A spectral model
consisting of a multicolor disk blackbody with inverse-Compton emission from a
hot corona gives a good fit to X-ray spectra obtained with XMM-Newton. Using
the fitted X-ray spectrum, we calculate the relation between the He{\sc ii} and
X-ray luminosity and find that the He{\sc ii} flux implies a lower bound on the
X-ray luminosity in the range 4 to $6 \times 10^{39} \rm erg s^{-1}$ if the
extrapolation of the X-ray spectrum between 54 eV and 300 eV is accurate. A
compact object mass of at least 25 to $40 M_{\odot}$ would be required to avoid
violating the Eddington limit.
