A sequence of shallow earthquakes of magnitudes ≤5.1 took place in 2004 on the eastern flank of the Red Sea rift, near the city of Tabuk in northwestern Saudi Arabia. The earthquakes could not be well located due to the sparse distribution of seismic stations in the region, making it difficult to associate the activity with one of the many mapped faults in the area and thus to improve the assessment of seismic hazard in the region. We used Interferometric Synthetic Aperture Radar (InSAR) data from the European Space Agency’s Envisat and ERS‐2 satellites to improve the location and source parameters of the largest event of the sequence (Mw 5.1), which occurred on 22 June 2004. The mainshock caused a small but distinct ∼2.7 cm displacement signal in the InSAR data, which reveals where the earthquake took place and shows that seismic reports mislocated it by 3–16 km. With Bayesian estimation, we modeled the InSAR data using a finite‐fault model in a homogeneous elastic half‐space and found the mainshock activated a normal fault, roughly 70 km southeast of the city of Tabuk. The southwest‐dipping fault has a strike that is roughly parallel to the Red Sea rift, and we estimate the centroid depth of the earthquake to be ∼3.2 km. Projection of the fault model uncertainties to the surface indicates that one of the west‐dipping normal faults located in the area and oriented parallel to the Red Sea is a likely source for the mainshock. The results demonstrate how InSAR can be used to improve locations of moderate‐size earthquakes and thus to identify currently active faults.