The number of paramagnetic materials that undergo a structural phase transition is rather small, which can perhaps explain the limited understanding of the band Jahn-Teller mechanism responsible for this effect. Here we present a structural phase transition observed in paramagnetic Y2In at temperature T0=250±5 K. Below T0, the high-temperature hexagonal P63/mmc phase transforms into the low-temperature orthorhombic Pnma phase. This transition is accompanied by an unambiguous thermal hysteresis of about 10 K, observed in both magnetic susceptibility M/H(T) and resistivity ρ(T), indicating a first-order transition. Band structure calculations suggest a band Jahn-Teller mechanism, during which the degeneracy of electron bands close to the Fermi energy is broken. We establish that this structural phase transition does not have a magnetic component; however, the possibility of a charge density wave formation has not been eliminated.