The vast plume was initially spotted by amateur astronomers in 2012, and appeared twice before vanishing.
Scientists have now analysed the images and say that say the formation, stretching for more than 1,000km, is larger than any seen before.
Writing in the journal Nature, the researchers believe the plume could be a large cloud or an exceptionally bright aurora.
However, they are unsure how these could have formed in the thin upper reaches of the Martian atmosphere.
"It raises more questions than answers," said Antonio Garcia Munoz, a planetary scientist from the European Space Agency.