Gamma-ray bursts (GRBs) are the brightest explosions in the universe, yet the properties of their energy sources are far from understood. Very important clues, however, can be deduced by studying the afterglows of these events. We present observations of GRB 130831A and its afterglow obtained with Swift, Chandra, and multiple ground-based observatories. This burst shows an uncommon drop in the X-ray light curve at about 100 ks after the trigger, with a decay slope of α 7. The standard Forward Shock (FS) model offers no explanation for such a behaviour. Instead, a model in which a newly born magnetar outflow powers the early X-ray emission is found to be viable. After the drop, the X-ray afterglow resumes its decay with a slope typical of FS emission. The optical emission, on the other hand, displays no clear break across the X-ray drop and its decay is consistent with that of the late X-rays. Using both the X-ray and optical data, we show that the FS model can explain the emission after 100 ks. We model our data to infer the kinetic energy of the ejecta and thus estimate the efficiency of a magnetar “central engine” of a GRB. Furthermore, we break down the energy budget of this GRB into prompt emission, late internal dissipation, kinetic energy of the relativistic ejecta, and compare it with the energy of the accompanying supernova, SN 2013fu.