Most species of modern iguanas (Iguania, Iguanidae) dig burrows for dwelling and nesting, yet neither type of burrow has been interpreted as trace fossils in the geologic record. Here we describe and diagnose the first known fossil example of an iguana nesting burrow, preserved in the Grotto Beach Formation (Early Late Pleistocene, ~115 kya) on San Salvador Island, The Bahamas. The trace fossil, located directly below a protosol, is exposed in a vertical section of a cross-bedded oolitic eolianite. Abundant root traces, a probable land-crab burrow, and lack of ghost-crab burrows further indicate a vegetated inland dune as the paleoenvironmental setting. The trace fossil matches dimensions and overall forms of burrows made by modern iguanas, and internal structures indicate active backfilling consistent with modern iguana nesting burrows. The trace fossil is also located on an island with a modern native species of rock iguana (Cyclura riyeli riyeli), suggesting a presence of iguanas on San Salvador since the Late Pleistocene. This nesting burrow may provide a search image for more fossil iguana burrows in The Bahamas and other places with long-established iguana species and favorable geological conditions for preserving their burrows.