© 2018 authors. Published by the American Physical Society. We report the observation of I(2S)→γηb(1S) decay based on an analysis of the inclusive photon spectrum of 24.7 fb-1 of e+e- collisions at the I(2S) center-of-mass energy collected with the Belle detector at the KEKB asymmetric-energy e+e- collider. We measure a branching fraction of B[I(2S)→γηb(1S)]=(6.1-0.7-0.6+0.6+0.9)×10-4 and derive an ηb(1S) mass of 9394.8-3.1-2.7+2.7+4.5 MeV/c2, where the uncertainties are statistical and systematic, respectively. The significance of our measurement is greater than 7 standard deviations, constituting the first observation of this decay mode.