Gamma-ray bursts (GRBs) are among the brightest and most energetic events in the Universe. The duration and hardness distribution of GRBs has two clusters1, now understood to reflect (at least) two different progenitors2. Short-hard GRBs (SGRBs; T90 < 2 s) arise from compact binary mergers, and long-soft GRBs (LGRBs; T90 > 2 s) have been attributed to the collapse of peculiar massive stars (collapsars)3. The discovery of SN 1998bw/GRB 980425 (ref. 4) marked the first association of an LGRB with a collapsar, and AT 2017gfo (ref. 5)/GRB 170817A/GW170817 (ref. 6) marked the first association of an SGRB with a binary neutron star merger, which also produced a gravitational wave. Here, we present the discovery of ZTF20abwysqy (AT2020scz), a fast-fading optical transient in the Fermi satellite and the Interplanetary Network localization regions of GRB 200826A; X-ray and radio emission further confirm that this is the afterglow. Follow-up imaging (at rest-frame 16.5 days) reveals excess emission above the afterglow that cannot be explained as an underlying kilonova, but which is consistent with being the supernova. Although the GRB duration is short (rest-frame T90 of 0.65 s), our panchromatic follow-up data confirm a collapsar origin. GRB 200826A is the shortest LGRB found with an associated collapsar; it appears to sit on the brink between a successful and a failed collapsar. Our discovery is consistent with the hypothesis that most collapsars fail to produce ultra-relativistic jets.