We present Hubble Space Telescope imaging of a newly discovered faint stellar system, PAndAS-48, in the outskirts of the M31 halo. Our photometry reveals this object to be comprised of an ancient and very metal-poor stellar population with age greater than or similar to 10 Gyr and [Fe/H] less than or similar to -2.3. Our inferred distance modulus (m - M)(0) = 24.57 +/- 0.11 confirms that PAndAS-48 is most likely a remote M31 satellite with a three-dimensional galactocentric radius of 149(-8)(+19) kpc. We observe an apparent spread in color on the upper red giant branch that is larger than the photometric uncertainties should allow, and briefly explore the implications of this. Structurally, PAndAS-48 is diffuse, faint, and moderately flattened, with a half-light radius r(h) = 26(-3)(+4) pc, integrated luminosity M-V = -4.8 +/- 0.5, and ellipticity epsilon = 0.30(-0.15)(+0.08). On the size-luminosity plane it falls between the extended globular clusters seen in several nearby galaxies and the recently discovered faint dwarf satellites of the Milky Way; however, its characteristics do not allow us to unambiguously classify it as either type of system. If PAndAS-48 is a globular cluster then it is among the most elliptical, isolated, and metal-poor of any seen in the Local Group, extended or otherwise. Conversely, while its properties are generally consistent with those observed for the faint Milky Way dwarfs, it would be a factor of similar to 2-3 smaller in spatial extent than any known counterpart of comparable luminosity.