Three weeks prior to the commencement of Cassini's   4 year tour of the saturnian system, the spacecraft executed a close flyby of the outer satellite Phoebe. The infrared channel of the Visual Infrared Mapping Spectrometer (VIMS) obtained images of reflected light over the 0.83–5.1 μm spectral range with an average spectral resolution of 16.5 nm, spatial resolution up to 2 km, and over a range of solar phase angles not observed before. These images have been analyzed to derive fundamental photometric parameters including the phase curve and phase integral, spectral geometric albedo, bolometric Bond albedo, and the single scattering albedo. Physical properties of the surface, including macroscopic roughness and the single particle phase function, have also been characterized. Maps of normal reflectance show the existence of two major albedo regimes in the infrared, with gradations between the two regimes and much terrain with substantially higher albedos. The phase integral of Phoebe is 0.29±0.030.29±0.03, with no significant wavelength dependence. The bolometric Bond albedo is 0.023±0070.023±007. We find that the surface of Phoebe is rough, with a mean slope angle of 33°. The satellite's surface has a substantial forward scattering component, suggesting that its surface is dusty, perhaps from a history of outgassing. The spectrum of Phoebe is best matched by a composition including water ice, amorphous carbon, iron-bearing minerals, carbon dioxide, and Triton tholin. The characteristics of Phoebe suggest that it originated outside the saturnian system, perhaps in the Kuiper Belt, and was captured on its journey inward, as suggested by Johnson and Lunine (2005).