We report the observation of pairing in a gas of atomic fermions with unequal numbers of two components. Beyond a critical polarization, the gas separates into a phase that is consistent with a superfluid paired core surrounded by a shell of normal unpaired fermions. The critical polarization diminishes with decreasing attractive interaction. For near-zero polarization, we measured the parameter β = –0.54 ± 0.05, describing the universal energy of a strongly interacting paired Fermi gas, and found good agreement with recent theory. These results are relevant to predictions of exotic new phases of quark matter and of strongly magnetized superconductors.