We report the observation of optically pumped lasing in ZnO at room temperature. Thin films of ZnO were grown by plasma-enhanced molecular beam epitaxy on (0001) sapphire substrates. Laser cavities formed by cleaving were found to lase at a threshold excitation intensity of 240kW cm−2. We believe these results demonstrate the high quality of ZnO epilayers grown by molecular beam epitaxy while clearly demonstrating the viability of ZnO based light emitting devices. ©1997 American Institute of Physics.