The first conclusive evidence of a dipole resonance in Li-11 having isoscalar character observed from inelastic scattering with a novel solid deuteron target is reported. The experiment was performed at the newly commissioned IRIS facility at TRIUMF. The results show a resonance peak at an excitation energy of 1.03 +/- 0.03 MeV with a width of 0.51 +/- 0.11 MeV (FWHM). The angular distribution is consistent with a dipole excitation in the distorted-wave Born approximation framework. The observed resonance energy together with shell model calculations show the first signature that the monopole tensor interaction is important in Li-11. The first ab initio calculations in the coupled cluster framework are also presented.