Forster's Terns (Sterna forsteri) breed mainly in central Canada and the north-central USA, and along both coasts of North America. In Mexico, only five nesting colonies were known prior to this study and all are coastal, three from Baja California, one from Colima on the Pacific coast, and one from Tamaulipas on the Gulf of Mexico. In 2014, a new inland colony was found at the Lake of Texcoco, east of Mexico City, Mexico. Eight nests that were located on small islets 400 m away from shore were monitored from April to June 2014. Almost 90% of the eggs (n = 16) were lost by flooding, and only two chicks hatched. One chick died and the other survived to fledging, and at 25 days old it dispersed more than 3 km from the colony. This nesting colony at the Lake of Texcoco represents a new breeding site of Forster's Tern in Mexico, the first breeding record in an interior wetland of Mexico, and a southward expansion of the known breeding range for this species. These observations reinforce the importance of the Lake of Texcoco for breeding waterbirds in the Valley of Mexico.