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We present a study of McNeil’s Nebula, a newly appeared reflection nebula in the L1630 cloud, together with photometry and spectroscopy of its source. New IR photometry compared to earlier 2MASS data shows that the star has brightened by about 3 magnitudes in the near-infrared, changing its location in a J-H/H-K ′ diagram precisely along a reddening vector. A Gemini NIRI K-band spectrum shows strong CO-bandhead emission and Brγ is in emission, indicative of strong accretion. A Gemini GMOS optical spectrum shows only a red, heavily veiled continuum, with Hα strongly in emission and displaying a pronounced P Cygni profile, with an absorption trough reaching velocities up to 600 km s−1. This implies significant mass loss in a powerful wind. However, no evidence is found for any shocks, as commonly seen in collimated outflows from young stars. Apparently the eruption has dispersed a layer of extinction and this, together with the intrinsic brightening of the IRAS source, has allowed an earlier outflow cavity to be flooded with light, thus creating McNeil’s Nebula