  Using the NA48 detector at the CERN SPS, 31 KS->pi0 gamma gamma candidates
with an estimated background of 13.7 +- 3.2 events have been observed. This
first observation leads to a branching ratio of BR(KS->pi0 gamma gamma) = (4.9
+- 1.6(stat) +- 0.9(syst)) x 10^-8 in agreement with Chiral Perturbation theory
predictions.
