The long-sought yet elusive Majorana fermion(1) is predicted to arise from a combination of a superconductor and a topological insulator(2-4). An essential step in the hunt for this emergent particle is the unequivocal observation of supercurrent in a topological phase. Here, direct evidence for Josephson supercurrents in superconductor (Nb)-topological insulator (Bi2Te3)-superconductor electron-beam fabricated junctions is provided by the observation of clear Shapiro steps under microwave irradiation, and a Fraunhofer-type dependence of the critical current on magnetic field. Shubnikov-de Haas oscillations in magnetic fields up to 30 T reveal a topologically non-trivial two-dimensional surface state. This surface state is attributed to mediate the ballistic Josephson current despite the fact that the normal state transport is dominated by diffusive bulk conductivity. The lateral Nb-Bi2Te3-Nb junctions hence provide prospects for the realization of devices supporting Majorana fermions(5).