We report the optical identification of RE 2107-05, a new EUV source discovered in the ROSAT Wide Field Camera all-sky survey, and present the results of subsequent follow-up observations. The optical counterpart of RE 2107-05 is identified spectroscopically with a 15-mag star that has an emission-line spectrum characteristic of magnetic cataclysmic variables. Using subsequent photometry and polarimetry, we demonstrate that the counterpart shows strong and variable circular polarization, confirming this to be an AM Her system. The polarimetry and photometry are modulated at a period of 125 min, and the optical light curve shows an eclipse with a complex, wavelength-dependent profile