We have observed the ultra-compact low–mass X–ray binary ( LMXB ) 1A 1246–588 with the Rossi X–ray Timing Explorer ( RXTE ) . In this manuscript we report the discovery of a kilohertz quasi–periodic oscillation ( QPO ) in 1A 1246–588 . The kilohertz QPO was only detected when the source was in a soft high–flux state reminiscent of the lower banana branch in atoll sources . Only one kilohertz QPO peak is detected at a relatively high frequency of 1258 \pm 2 Hz and at a single trial significance of more than 7 \sigma . Kilohertz QPOs with a higher frequency have only been found on two occasions in 4U 0614+09 . Furthermore , the frequency is higher than that found for the lower kilohertz QPO in any source , strongly suggesting that the QPO is the upper of the kilohertz QPO pair often found in LMXBs . The full–width at half maximum is 25 \pm 4 Hz , making the coherence the highest found for an upper kilohertz QPO . From a distance estimate of \approx 6 kpc from a radius expansion burst we derive that 1A 1246–588 is at a persistent flux of \approx 0.2–0.3 per cent of the Eddington flux , hence 1A 1246–588 is one of the weakest LMXBs for which a kilohertz QPO has been detected . The root–mean–square ( rms ) amplitude in the 5–60 keV band is 27 \pm 3 per cent , this is the highest for any kilohertz QPO source so far , in line with the general anti–correlation between source luminosity and rms amplitude of the kilohertz QPO peak identified before . Using the X–ray spectral information we produce a colour–colour diagram . The source behaviour in this diagram provides further evidence for the atoll nature of the source .