  We discuss the X-ray and optical properties of the massive galaxy cluster
MACSJ1206.2-0847 (z=0.4385), discovered in the Massive Cluster Survey (MACS).
Our Chandra observation of the system yields a total X-ray luminosity of 2.4 x
10^45 erg/s (0.1-2.4 keV) and a global gas temperature of (11.6 +/- 0.7) keV,
very high values typical of MACS clusters. In both optical and X-ray images
MACSJ1206 appears close to relaxed in projection, with a pronounced X-ray peak
at the location of the brightest cluster galaxy (BCG); we interpret this
feature as the remnant of a cold core. A spectacular giant gravitational arc,
15" in length, bright (V~21) and unusually red (R-K=4.3), is seen 20" west of
the BCG; we measure a redshift of z=1.036 for the lensed galaxy. From our HST
image of the cluster we identify the giant arc and its counter image as a
seven-fold imaged system. An excess of X-ray emission in the direction of the
arc coincides with a mild galaxy overdensity and could be the remnant of a
minor merger with a group of galaxies. We derive estimates of the total cluster
mass as well as of the mass of the cluster core using X-ray, dynamical, and
gravitational-lensing techniques. For the mass enclosed by the giant arc (r<119
kpc) our strong-lensing analysis based on HST imaging yields a very high value
of 1.1 x 10^14 M_sun, inconsistent with the much lower X-ray estimate of 0.5 x
10^14 M_sun. Similarly, the virial estimate of 4 x 10^15 M_sun for the total
cluster mass, derived from multi-object spectroscopy of 38 cluster members, is
significantly higher than the corresponding X-ray estimate of 1.7 x 10^15
M_sun. We take the discrepant mass estimates to be indicative of substructure
along the line of sight during an ongoing merger event, an interpretation that
is supported by the system's very high velocity dispersion of 1580 km/s.
