We undertake the first detailed analysis of the stellar population and spatial properties of a diffuse substructure in the outer halo ofM31. The South-West Cloud lies at a projected distance of ̃100 kpc from the centre of M31 and extends for at least ̃50 kpc in projection. We use Pan-Andromeda Archaeological Survey photometry of red giant branch stars to determine a distance to the South-West Cloud of 793+45 -45 kpc. The metallicity of the cloud is found to be [Fe/H] = -1.3 ± 0.1. This is consistent with the coincident globular clusters PAndAS-7 and PAndAS-8, which have metallicities determined using an independent technique of [Fe/H] = -1.35 ± 0.15. We measure a brightness for the Cloud of MV = -12.1 mag; this is ̃75 per cent of the luminosity implied by the luminosity-metallicity relation. Under the assumption that the South-West Cloud is the visible remnant of an accreted dwarf satellite, this suggests that the progenitor object was amongst M31's brightest dwarf galaxies prior to disruption. © 2013 The Authors Published by Oxford University Press on behalf of the Royal Astronomical Society. ; peer reviewed: yes ; NRC Pub: yes