Discovery of the peculiar supernova 1998bw in the error box of GRB980425

The discovery of X-ray, optical and radio afterglows of gamma-ray bursts (GRBs) and the measurements of the distances to some of them have established that these events come from Gpc distances and are the most powerful photon emitters known in the Universe, with peak luminosities up to 10^52 erg/s. We here report the discovery of an optical transient, in the BeppoSAX Wide Field Camera error box of GRB980425, which occurred within about a day of the gamma-ray burst. Its optical light curve, spectrum and location in a spiral arm of the galaxy ESO 184-G82, at a redshift z = 0.0085, show that the transient is a very luminous type Ic supernova, SN1998bw. The peculiar nature of SN1998bw is emphasized by its extraordinary radio properties which require that the radio emitter expand at relativistical speed. Since SN1998bw is very different from all previously observed afterglows of GRBs, our discovery raises the possibility that very different mechanisms may give rise to GRBs, which differ little in their gamma-ray properties.