We present the first detailed description of the giant Eocene penguin Icadyptes salasi. The species is characterized by a narrow skull with a hyper-elongate spear-like beak, a robust cervical column and a powerful flipper. The bony beak tip of Icadyptes is formed by fusion of several elements and is unique among penguins, differing markedly from previously described giant penguin beaks. Vascular canal patterning similar to that of boobies, frigatebirds and albatrosses suggests I. salasi may have had a thin, sheet-like rhamphotheca unlike the thick rugose rhamphotheca of modern penguins. Together, these features suggest a novel ecology for I. salasi, most likely involving the capture of larger prey items via spearing. As the first described giant penguin specimen to preserve a complete wing skeleton, the I. salasi holotype yields significant insight into the shape, proportions and orientation of the wing in giant penguins. In articulation, the forelimb of I. salasi is straighter, permitting less manus and antibrachium flexion, than previous depictions of giant penguin wings. Cross-sections of the humerus and ulna reveal a level of osteosclerosis equalling or surpassing that of extant penguins. Based on ontogenetic data from extant penguins and the morphology of the carpometacarpus of I. salasi, we infer the retention of a free alular phalanx in basal penguins. Previously, the status of this element in penguins was disputed. Differences in the proportions of the manual phalanges contribute to a more abruptly tapering wingtip in I. salasi compared with crown penguins. Fossils from Peru, including the I. salasi holotype specimen, document that penguins expanded to nearly the whole of their extant latitudinal range early in their evolutionary history and during one of the warmest intervals in the Cenozoic.