  Although more than 2,000 astronomical gamma-ray bursts (GRBs) have been
detected, and numerous models proposed to explain their occurrence, they have
remained enigmatic owing to the lack of an obvious counterpart at other
wavelengths. The recent ground-based detection of a transient source in the
vicinity of GRB 970228 may therefore have provided a breakthrough. The optical
counterpart appears to be embedded in an extended source which, if a galaxy as
has been suggested, would lend weight to those models that place GRBs at
cosmological distances. Here we report the observations using the Hubble Space
Telescope of the transient counterpart and extended source 26 and 39 days after
the initial gamma-ray outburst. We find that the counterpart has faded since
the initial detection (and continues to fade), but the extended source exhibits
no significant change in brightness between the two dates of observations
reported here. The size and apparent constancy between the two epochs of HST
observations imply that it is extragalactic, but its faintness makes a
definitive statement about its nature difficult. Nevertheless, the decay
profile of the transient source is consistent with a popular impulsive-fireball
model, which assumes a merger between two neutron stars in a distant galaxy.
