We report the observation of the decay mode B±→pp¯K± based on an analysis of 29.4fb−1 of data collected by the Belle detector at KEKB. This is the first example of a b→s transition with baryons in the final state. The pp¯ mass spectrum in this decay is inconsistent with phase space and is peaked at low mass. The branching fraction for this decay is measured to be B(B±→pp¯K±)=[4.3+1.1−0.9(stat)±0.5(syst)]×10−6. We also report upper limits for the decays B0→pp¯KS and B±→pp¯π±.