We present direct evidence for ultra-fast dissociation of molecular water in connection photo-excitation of the Ols --> 4a(1) resonance. The core-excited H2O molecules are shown to dissociate into core-excited O*H and neutral H on a time scale comparable to the core hole lifetime, i,e. a few femtoseconds. This conclusion is based on a resonant Auger study, qualitative arguments and ab initio calculations. 'Hot bands' connected to Anger transitions from vibrationally excited OH fragments are identified, and these exhibit a dynamical behavior which qualitatively follows the change in excess energy.