The dynamics of the room temperature faceting of Ag(110) upon exposure to oxygen has been studied using scanning tunneling microscopy (STM). Vicinal surfaces are exposed to oxygen while STM images are continuously collected. The surfaces are observed to break up into regions of high step density ("step bunches") and (110) facets. This faceting is driven thermodynamically by the formation of an n X 1 oxygen overlayer on the (110) facet, in which rows of oxygen atoms form along the next-nearest neighbor [001] direction. The dynamics of this breakup are found to depend sensitively on the step-edge orientation of the original clean vicinal surface. The reversbility, and thus probable thermodynamic origin, of the faceting is demonstrated by removal of the oxygen through chemical reaction with CO.