In 1948, Jones showed that uniaxial media can in general show four different fundamental optical phenomena, each of which can appear in refraction and absorption. Three of these are well established: isotropic refraction and absorption, linear birefringence and dichroism, and circular birefringence and dichroism. The fourth effect, predicted by Jones, has remained unobserved so far. In this Letter, we report the first experimental observation of this missing fourth, so-called Jones effect, as an additional, tilted linear birefringence. In our experiments, this effect was induced in liquids by parallel external magnetic and electric fields perpendicular to the propagation direction.