Researchers at Glasgow University say a huge rock formation on the planet's surface is probably a giant fossil created billions of year ago by microbes.
Recently, doubts have been expressed about earlier claims by some scientists that signs of Martian life had been found in meteorites that landed on Earth.
But the Glasgow team believes that photographs of the fossil on the white rock - a 17km-wide feature in a giant crater - are the strongest proof to date of life on the red planet.
Professor Mike Russell says he believes the formation was caused by bacteria whose growth was fuelled by the sun and nutrients in the water in a crater lake.
However, he believes that the life forms probably retreated below ground billions of years ago when conditions became harder and water disappeared from the surface.
"There probably is still life on Mars, but not actually on the surface. Wherever there is water on a planet there is likely to have been life. But Mars now has a dry desert surface so there probably is not any life near the surface," he said.
Dr Russell also believes it possible that the formation on the white rock could be similar to magensium-rich deposits found on Earth, which were created by micro bacteria feeding on magnesium, carbon dioxide and iron and light.
The next NASA mission to Mars is due to blast off next year. It is not scheduled to visit the white rock, but Dr Russell hopes a future European space mission will investigate.